The US Securities and Exchange Commission (SEC) investigated the German bank for the way it accounted for certain assets in reports filed during the financial crisis.
The SEC said it over-valued some of these and did not have sufficient collateral to cover potential losses.
Deutsche is settling without admitting or denying the charges.
The bank said there was no reliable model at the time to value those trades, which were made in the aftermath of the credit crisis and the subsequent collapse of Lehman Brothers.
The SEC said the risk for potential losses ran into billions of dollars - a risk which the SEC says was not properly reported to investors.
Its investigation found that Deutsche overvalued the value of certain transactions designed to protect against losses on securities in the then highly volatile credit markets.
The collateral covering the portfolio was only a fraction, approximately 9%, of the $98bn total in purchased protection.
"At the height of the financial crisis, Deutsche Bank's financial statements did not reflect the significant risk in these large, complex illiquid positions," said Andrew Ceresney, director of the SEC's enforcement division.
"Deutsche Bank failed to make reasonable judgments when valuing its positions and lacked robust internal controls over financial reporting."
Last week, Deutsche Bank encountered anger from its shareholders at its annual general meeting.
One of the causes of investor unease was the mounting tally of regulatory fines.
Investors singled out a $2.5bn fine to settle investigations into the bank's involvement in the rigging of the Libor interest rate.

More than 1,800 cases have been recorded in recent weeks, compared to 1,695 cases for all of 2010. Five deaths have been reported so far.
The mosquito that carries the dengue virus breeds in containers with clear, stagnant water.
Dengue cases usually jump during and just after the rainy season, which normally lasts from June to September.
Hospitals and clinics across the city have been inundated with patients, putting a strain on emergency services.
News channels are showing patients sharing beds and scores of people queuing up at clinics for free fever tests.
The government in Delhi has ordered 1,000 extra bed in hospitals to treat dengue patients after the suicide of a couple whose seven-year-old son died from the tropical illness after being allegedly refused treatment at a number of city hospitals.
Delhi Health Minister Satyendar Jain has also ordered the setting up of "fever clinics" at hospitals to deal with the rush of patients.
"There is no need to panic. I have ordered all government hospitals that they should not refuse to admit dengue patients even if they have to treat two patients on a single bed," he said.
"The panic in people about the spread of dengue is leading to a huge burden on hospitals."
YK Mann, director of the Municipal Corporation of Delhi, told the AFP news agency that this was "the worst outbreak in the last five years and it is going to further increase as the weather remains humid".
The government's latest move comes after a couple jumped to their death from a four-storey building in Delhi last week, two days after their son died of the fever.
The authorities ordered a magisterial inquiry into the death after local media reported that the boy was refused admission at five private hospitals. The reports sparked outrage and anger in the city.
Monsoon rains provide more breeding grounds for disease-carrying mosquitoes, who lay their eggs in stagnant water, including pots of clean water, puddles and open sewage drains.

The Alert Line is designed to provide independent support for anyone wanting to raise concerns about practices within the health service.
The Scottish government will also introduce a new Whistleblowing Officer to scrutinise the handling of cases.
Health Secretary Shona Robison said she wanted staff to be able to "speak up without fear".
Ms Robison added: "I have always been clear that health boards must ensure that it is safe and acceptable for staff to speak up about any concerns they may have, particularly in relation to patient safety.
"We will continue to work with the NHS across Scotland to ensure an open and transparent reporting culture where all staff have the confidence to speak up."
The National Confidential Alert Line will be extended for one year from 1 August 2016 to 31 July 2017.
The phoneline, 0800 008 6112, will pass any concerns raised by employees on to the employer or the relevant regulatory organisation for investigation.
Deutsche Bank is paying $55m (£35.7m) to settle civil charges for allegedly mis-stating financial reports.
[NEXT_CONCEPT]
The Indian capital, Delhi, is in the grip of the worst outbreak of dengue fever in five years, officials say.
[NEXT_CONCEPT]
A confidential whistleblowing line for NHS staff in Scotland has been extended for a year.