The Securities and Exchange Commission (SEC) has launched an investigation into alleged Deutsche Bank losses of $12 billion, prompted by claims from three whistleblowers, according to Corporate Counsel magazine in the US and the Financial Times newspaper in the UK.

Heavy price

The report claims that Eric Ben-Artzi -- a former risk analyst at the bank -- is perhaps the first whistleblower in SEC history to make a public statement. Through his advisers – New York and Delaware-based law firm Labaton Sucharow and Washington-based whistleblower protection group, the Government Accountability Project – Mr Ben-Artzi said the bank failed to address concerns he raised initially last year, and that he was subsequently made redundant.
‘As the problem was not acknowledged or corrected, I felt compelled to inform he proper law enforcement authorities,’ he said in a statement. ‘Unfortunately, my family and I are paying a heavy price for doing the right thing.’

Shocked

Commenting on the allegations, Jordan Thomas of Labaton Sucharow’s whistleblower representation practice, said: ‘I was shocked by the size and scope of the alleged misconduct. This is exactly the type of significant and unreported securities violations that the SEC whistleblower programme was intended to address. It is one of many high-profile matters in the pipeline.’
However, Corporate Counsel reports the bank strongly denies the allegations. In a statement to the magazine, it said: The allegations of financial misstatements, which are more than two and one-half years old and were publicly reported in June 2011, have been the subject of a careful and thorough investigation, and they are wholly unfounded.’