A 5-year investigation led to the conclusion that Deutsche Bank had overvalued its derivatives portfolio at the height of the 2008 financial crisis, hiding potential loses.
Deutsche Bank agreed to pay a $55 million penalty to the Securities and Exchange Commission to settle claims that its “inadequate internal accounting controls” violated federal securities law.
The settlement closed claims raised by former Deutsche Bank employees that the bank mispriced derivatives to hide potential trading losses during the 2008 crisis. The S.E.C. estimated that the bank had overvalued the derivatives portfolio by $1.5 billion.
All information in this case study is based on data that was found on public domain and official public records.