Barclays Bank was just the first to be accused of artificially manipulating the benchmark LIBOR (London Interbank Offered Rate) and has paid a steep price: the bank must pay a fine of $455 milion and both its CEO and Chairman were forced to step down. More dismissals and possible criminal charges may follow.
Now there is growing speculation that Deutsche Bank was very much involved in the rate-fixing scheme - which took place over years. German bank regulators are investigating:
Germany's markets regulator has launched a special probe into Deutsche Bank over suspected manipulation of interbank lending rates, joining authorities around the globe investigating the world's largest banks, two people familiar with the matter said on Friday.
And the German BaFin are not the only regulatory bodies looking at Deutsche Bank:
Deutsche Bank has disclosed that it is cooperating with the U.S. Department of Justice, the U.S. Securities and Exchange Commission, the Commodity Futures Trading Commission, and the European Commission on Libor. These inquiries relate to periods between 2005 and 2011.
Separately, institutional investors in the United States are sueing Deutsche Bank for manipulating the interest rate, which determines the pricing of many loans and fixed income securities:
Eine zum Frankfurter Bankhaus Metzler gehörende Kapitalanlagegesellschaft habe sich in New York an mehreren Sammelklagen gegen die Deutsche Bank und andere Banken beteiligt, die der Manipulation des Marktzinssatzes Libor bezichtigt werden, bestätigte ein Metzler-Sprecher am Sonntag einen Bericht des "Spiegel". "Das machen zurzeit sehr viele Kapitalanlagegesellschaften". Dem Magazin zufolge lässt die Deutsche Bank seit Monaten von externen Prüfern untersuchen, ob ihre Händler an Manipulationen beteiligt waren. Zwei Mitarbeiter seien bereits suspendiert worden.
(An investment firm belonging to Bankhaus Metzler has joined a class action suit in New York against Deutsche Bank and other banks, which are accused of manipulating LIBOR. A spokesman for Metzler confirmed the report in "Der Spiegel". "At this time four investment firms are involved in the suit." According to the magazine article Deutsche Bank has been investigated for months by external bank examiners concerning possible involvement by bank traders. Two employees have already been suspended.)
This new scandal has Anshu Jain's fingerprints all over it; he had been running DB's global markets buisness since 2002. And, of course, the period in question was during the tenure of Josef Ackermann. Will the German government take this interest rate manipulation as seriously as the UK government? Will current and past Deutsche Bank managers be held accountable for their illegal actions? Or will Angela Merkel throw Ackermann another birthday party?
Comments