The regulator found that for two years Commerzbank either failed to report or reported inaccurately almost all of its reportable transactions.
Firms are required to ensure they submit accurate data for reportable transactions by close of business the day after a trade is executed.
The FSA uses this data to detect and investigate suspected market abuse like insider trading and market manipulation.
These breaches occurred despite the FSA sending repeated reminders to firms of their obligations to provide accurate data and the importance of compliance with the FSA rules on transaction reporting, and specific requests to Commerzbank for the firm to check its data.
FSA director of markets Alexander Justham says: “Complete and accurate transaction reports are an essential component of the FSA’s market monitoring work.
“Commerzbank’s reporting failures could have a damaging impact on our ability to detect and investigate suspected market abuse.
“Firms and their management must ensure they submit quality transaction reporting data.”