SEC Whistleblower Goes Public with Deutsche Bank Allegations

“When Ben-Artzi first consulted with me, I was shocked by the size and scope of the alleged misconduct,” said Thomas, a former SEC assistant director and chair of the firm’s whistleblower representation practice “This is exactly the type of significant and unreported securities violations that the SEC Whistleblower Program was intended to address. It is one of many high-profile matters in the pipeline.”

Thomas said the bank’s claim that these were old allegations is bogus. “The SEC regularly investigates allegations that are up to five years old,” he said. “This is current.”

In its statement, the bank tried to discredit the whistleblowers. It said, “The investigation revealed that these allegations stem from people without personal knowledge of, or responsibility for, key facts and information.”

Thomas and Ben-Artzi also disputed that claim. “Ben-Artzi was a risk analyst specifically assigned and well situated to look exactly at that issue,” according to Thomas. “He was in a position to have personal knowledge and see evidence of misconduct.”

The bank also insisted that its “valuations and financial reporting were proper, and a significant portion of these positions were subsequently unwound in an orderly sale.”

But again, Thomas and Ben-Artzi objected. The former analyst said at the time he was working, “it was still the biggest risk on the books.”

And Thomas argued it didn’t matter if some of the trades were unwound. “It doesn’t mean you didn’t have a problem in prior years. You don’t have to be at a crime scene when the crime was committed to have evidence relevant to the crime,” he said.

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