Deutsche Bank fires forex unit head, two other traders as currency manipulation investigation heats up

A source who was familiar with the decision said Deutsche Bank has fired three of its staff members based in New York as regulators all over the world accelerated their own investigations regarding possible manipulation of currencies. The foreign exchange market trading at $5 trillion daily, notes The New York Times' The DealBook. Among those who exited Deutsche Bank was the head of the bank's foreign exchange in emerging markets trading desk. The source refused to be identified as the person was not given the authority to speak about the matter in public.

The exit of three of Deutsche Bank's traders followed the suspension of some of its traders in January this year based on reports of currency manipulation.

When asked by DealBook about the source's information, Deutsche Bank refused to comment, citing company policy on discussions about its employees on Wednesday. However, the bank said that it has been cooperating with regulators about the investigations and that it will be taking disciplinary action should it be merited.

Britain's Financial Conduct Authority, Martin Wheatley said on Tuesday that the currency manipulation charges was as bad as with the London interbank offered rate manipulation. DealBook said that in the past two years, banks had paid over $5 billion in fines relating to the manipulation of the Libor and other benchmark interest rates. A minimum of 10 individuals in the US and Britian could face jail time with regard to Libor manipulation, DealBook added, with the first of the cases to go on trial in 2015.

In the last year, British, US, German and Swiss regulators had launched investigations on alleged manipulation of foreign currencies, and all are in their early stages.

At this point, over a dozen foreign exchange traders from some of the world's top banks were reportedly forced on leaves due to the claims that they had initiated or conspired with the benchmark currency rates manipulation, DealBook said. Sources told DealBook that Lloyds Banking Group this week over the course of its internal investigation have placed a senior currency trader on a sabbatical. Citigroup in January sacked its European spot currency trading desk head after he was placed on leave by the bank in 2013.

Tags

Deutsche Bank, Financial Conduct Authority, Lloyds Banking Group

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