Deutsche Bank Agrees to $2.5B Rate-Rigging Penalty
Deutsche Bank will pay a $2.5B penalty to American and British authorities in what is easily the biggest fine levied on a large bank over accusations of rate-fixing that helped trigger the Great Recession. Benjamin Lawsky, the New York State superintendent of financial services, said in an announcement today that DB employees in London and Frankfurt purposefully and knowingly rigged interest rates on mortgages, student loans and other debts between 2005 and 2009. Additional facets of the punishment will require DB to fire seven managers involved in the scheme and for a British subsidiary to plead guilty to fraud.
Until this penalty, UBS had the dubious distinction of paying the largest rate-fixing penalty when it agreed in 2012 to a $1.5B settlement.
