Deutsche Bank’s South Korean brokerage unit has been fined 1.5 billion won (US$1.25 million) and one of its employees sentenced to five years in prison over a 2010 stock market manipulation case.
A Seoul court imposed the punishment Monday after it found the German firm made illegal gains by triggering a market plunge on Nov. 11, 2010 in South Korea, Bloomberg News reported.
Deutsche Securities Korea earned 44.8 billion won by causing an equities rout that wiped out 28 trillion won in value from the stock market, according to a ruling by the Seoul Central District Court.
A 43-year-old employee, who was not identified, was handed a five-year jail term for his role in the market manipulation.
On Nov. 11, 2010, the Kospi 200 Index slumped 2.8 percent in the last 10 minutes of trading due to derivatives positions set by the Deutsche Securities employee and three Hong Kong-based colleagues, according to prosecutors.
The three traders in Hong Kong are said to have sold 2.44 trillion won worth of shares.
“Deutsche Bank respectfully acknowledges the court’s decision regarding its Korean subsidiary,” Bloomberg cited Michael West, a Hong Kong-based spokesman for the parent company, as saying in an e-mailed statement.
He said the bank “has strengthened its systems and controls and is committed to compliance with applicable laws and regulation in all jurisdictions.”
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