Germany opens investigation into bankers' role in rate rigging
German prosecutors have launched preliminary inquiries into the roles individuals may have played in connection with Deutsche Bank's participation in the interest rate-rigging scandal, the 'Financial Times' reported online yesterday.
Earlier this month, a source told Reuters that Germany's financial watchdog Bafin had heavily criticised Deutsche Bank in its report investigating attempts to manipulate inter-bank interest rates such as Libor. The German regulator has been investigating Deutsche Bank and the role it played during the financial crisis when a global inter-bank lending rate mechanism was being manipulated.
Now the Frankfurt prosecutor has opened a new line of inquiry after the report, which was highly critical of management's behaviour during the rate-rigging attempts, according to the FT.
Neither the bank nor the prosecutor were immediately available to comment. Any new investigation would deepen Deutsche's legal difficulties and complicate the task incoming chief executive John Cryan faces in turning around the bank when he takes office.
Mr Cryan was named new CEO after the bank's two current chief executives quit in June following a string of regulatory run-ins, failed performance promises and a shareholder vote of no confidence.
The newspaper quoted Nadja Niesen, a senior prosecutor, as saying that a preliminary investigation had been opened.
"Those suspected are all represented by lawyers and are also aware of the process. How things proceed depends on the evaluation of the Bafin report, which has only recently been received," Niesen was quoted as saying.
Deutsche Bank said on Friday that BaFin's report confirmed that no present or former member of its management board or executive committee told employees to manipulate rates. (Reuters)