A group of investors has filed a damage suit against Deutsche Bank AG alleging stock market manipulation by the German financial firm, which they blame for subsequent investment losses, a Seoul court said Monday.
The six investors filed the suit with the Seoul Central District Court against the global financial firm and also local brokerage company Korea Investment & Securities Co., demanding the two companies pay 110 million won (US$98,302) in compensation.
The complaint states Deutsche Bank's massive unloading of KB Financial Group shares in August 2009 stripped them of potential investment returns on their holdings of equity-linked securities (ELS).
They were expecting profits on the financial derivative products, which were sold in 2007 by the local brokerage firm and structured to yield returns upon the movements of KB Financial shares.
Korea Investment later struck a contract with Deutsche Bank to hedge the ELS products and the German firm unloaded a massive amount of KB Financial shares shortly before the derivatives came due in 2009, the complaint read, in what the plaintiffs claimed was market manipulation led by the foreign financial company.
Deutsche Bank and four of its local and overseas executives were officially charged last year over a separate market manipulation case involving massive stock sell-offs in November 2010, which led to a steep one-day dive of the local key stock index KOSPI. That case is awaiting trial. (Yonhap News)
