South Korean prosecutors have charged four Deutsche Bank employees with illegally manipulating Seoul's stock market last year to earn more than $40 million on a single day, a report said Sunday.
Yonhap news agency said the German bank's Seoul securities unit and the four workers - including three foreigners - were accused of amassing 44.8 billion won ($41.3 million) through illegal trading on the spot and futures markets.
Deutsche Bank said in a statement that it denied the charges and would defend itself in court, according to Dow Jones Newswires. The bank said it did not authorise or condone any breach of market regulation.
The bank's Hong Kong unit and securities unit in Seoul have been under investigation for alleged market manipulation and unfair transactions last November 11, an options expiry day. On that day Seoul's benchmark KOSPI share index fell a hefty 48 points in the session's last 10 minutes due to arbitrage trading between the spot and futures markets. During that time about 2.4 trillion won ($2.16 billion) in sell orders from foreign investors were processed, most of them through Deutsche Bank's local securities unit.
The KOSPI ended the day 53.12 points, or 2.79 percent, lower at 1,914.73.
Prosecutors said Deutsche Bank's securities unit in Seoul and the four workers knowingly placed heavy sell orders so as to pocket massive returns from put options, which were structured to generate profits if the KOSPI plunged.