Deutsche Bank Fires Two Senior Trading Executives
Ben Solomon and Ashish Jain are no longer with the bank
Deutsche Bank AG has fired two senior trading executives for alleged lax supervision of a pair of more junior employees whose communications with clients allegedly violated the lender’s policies, a person familiar with the matter said.
Deutsche Bank executives on Wednesday told employees that the German bank had terminated Ben Solomon, head of securitized products trading, and Ashish Jain, head of securitized products sales in the Americas, the person said. The decision was unveiled internally more than a month after Deutsche Bank fired the junior traders, Aaron Greenberg and Joe Reardon, for allegedly lying to clients over the pricing of commercial mortgage bonds, the person said.
The employees, who worked in the bank’s New York office, are the latest traders to draw scrutiny for what they told clients in negotiations over the price of complex debt securities. Federal investigators have been probing these communications amid concern that traders at times lie to customers to maximize their profits on trades.
The two-year prison sentence handed to former Jefferies Group LLC trader Jesse Litvak in July 2014 for lying about how much he had paid for securities sent shockwaves through the industry, which had struggled to define the line between fraudulent behavior and common negotiating ploys between sophisticated parties. Mr. Litvak, who was found guilty of securities fraud, is appealing the federal jury’s verdict.
Deutsche Bank let the two junior traders go in June after an internal review found they had “violated firm policies.” According to the Financial Industry Regulatory Authority’s database of licensed securities industry employees, Deutsche Bank had reviewed communications between Messrs. Greenberg and Reardon and clients in response “to a regulatory request for information regarding CMBS [commercial mortgage-backed securities] trading practices.”
Bloomberg News previously reported the departures of Messrs. Greenberg and Reardon. The reason they left, though, hadn’t been known broadly until their Finra reports were updated to note their discharge from the bank.
The probe is being conducted by the Securities and Exchange Commission, and the special inspector general for the Troubled Asset Relief Program, or Sigtarp, The Wall Street Journal has reported.
Messrs. Solomon, Jain, Greenberg and Reardon couldn’t immediately be reached for comment. An SEC spokeswoman declined to comment.
Source: WSJ – Deutsche Bank Fires Two Senior Trading Executives
