Exchange rates around the world are constantly in flux, and it’s an incredibly exact science. Currencies are traded to the fourth decimal point. No wonder investors will get angry if they believe a bank is delaying – even by a second – their trades in the market.
Deutsche Bank faces class action lawsuits in New York and London over allegations that it did just that: Delaying currency deals to profit from better exchange rates at the expense of its customers, Handelsblatt has learned. The story was first reported by Germany’s Spiegel magazine.
It is one of thousands of lawsuits and regulatory investigations facing Germany’s largest bank in the United States and Europe. Like many global banks around the world, Deutsche Bank has been dogged by allegations of wrongdoing by its traders ever since the 2008 financial crisis.
Axiom Investment Advisors and the law firm Hausfeld claim their clients lost more than $5 billion (€5.4 billion) through Deutsche Bank’s exploitation of a currency trading practice called “last look.”
New York’s Department of Financial Services has been investigating the controversial practice at a number of banks since 2014, including Deutsche Bank and even fined British bank Barclays over the practice last year.