December 21, 2012
Just six months after installing new leadership that was supposed to rehabilitate its battered public image, Germany’s Deutsche Bank finds itself in a growing scandal over its behind-the-scenes maneuvering in a criminal investigation of the bank’s trading practices. As The Wall Street Journal reports, the bank’s co-Chief Executive Officer Jürgen Fitschen is under pressure to explain why he telephoned a senior German politician to complain about a police raid of the bank’s headquarters last week.
“The independence of the judiciary is of the highest importance for me,” Fitschen, a subject of the probe, tells a German newspaper. “If my call gave the public the wrong impression, I’m very sorry for that.” German lawmakers have accused Fitschen of trying to place the bank “above the law” by seeking to influence an ongoing criminal investigation. German authorities reportedly are investigating more than two dozen Deutsche Bank executives in connection with an alleged tax-fraud scheme involving cross-border trading of carbon-emissions certificates, which are used to limit pollution.
The scandal comes at a delicate time for Deutsche Bank, Europe’s largest bank by assets. Its reputation suffered after the financial crisis, which some say the bank helped cause as a major player in the market for U.S. mortgage-backed securities. Prosecutors are now investigating whether Deutsche Bank knowingly participated as a broker at the end of a string of carbon-credit trades designed to pocket money that should have gone to European tax authorities. — Greg Beaubien