Deutsche Bank receive biggest fine in rate rigging case to date

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Posted in:Banking and Finance|April 24, 2015 | Join the mailing list

The BBC have reported that Deutsche Bank is the latest financial institution to be fined by the US and UK regulators. The German led Bank has today been fined a record 2.5 billion dollars (£1.66bn) by US regulators and £227m by the FCA. The verdict of the investigation
into the fixing of interest rates by Deutsche Bank employees between 2005 and 2009 was found to be both deliberate and done in the knowledge that it was wrong.

The fines are the largest given to date incurred in a rate rigging case. The record fine is a reflection of the part played by Bank in the manipulation of Libor and Euribor inter-bank rates.  The Bank was additionally accused of deliberately misleading regulators
in their investigation into the scandal. Although the Bank reported to have disciplined and dismissed the individuals involved, in addition to the fine, US regulators have also requested the dismissal of a further seven senior individuals still employed at
the Bank, 5 of whom are London based.

Georgina Phillipou, the FCA’s acting director of enforcement and market oversight is quoted by the BBC to say “One division at Deutsche Bank had a culture of generating profits without proper regards to the integrity of the market. This wasn’t limited to a
few individuals on certain desks, it appeared deeply ingrained.”

The enormity of the fine is a reflection of the seriousness and duration of the breaches by the Bank. The verdict signifies the end to the seven year investigation but the enormity of it and the effects on the bank are yet to be visible.

Berg will update when more information is released.

If there are any issues in this update or more generally that you would like to discuss, please contact
Damian Carter or one of our Banking and Financial Regulatory team on 0161 833 9211.

(The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Berg or any of its partners or employees. Professional legal advice should
be obtained before taking, or refraining from taking, any action as a result of this article.)

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