Deutsche Bank MBS traders mispricing leads to $30 million loss.

Bloomberg | 11/26/02 | Stephen Cohen

[greencow]

Deutsche Puts Two Mortgage-backed Trades on Leave

New York, Nov. 26 (Bloomberg)-- Deutsche Bank AG placed two traders on administrative leave as it investigates mispricing of some of the firm's secondary trading positions of commercial mortgage-backed securities.

Deutsche Bank placed Jake Markman and Paul Mashikian on administrative leave while the firm conducts the investigation, according to spokesmen Ted Meyer.

The mispricing may result in more than $30 millions in losses, according to the report in Bond Week, which cited an individual with knowledge of the situation. The publication earlier reported that the two traders were placed on leave.

Meyer said that the bank doesn't "comment on market speculation as to whether there were losses." He also said, "Any impact on our book would not have a material impact on our earnings." Meyer said no clients lost money as a result of the trading.

Markman and Mashikian couldn't be reached for comment.

[NativeNewYorker]

This type of chicanery is a semi-annual event on Wall Street, with its own long-established pattern of outcomes.

There is a zero chance this will reach anywhere near SCOTUS.

A couple of ruined careers, a few folks screwed out of bonuses, some re-arranging of the internal reporting relationships and adding layers of bean-counters, a press release timed to hit an inside page of the WSJ...

[TonyS6]

I would wager every cent that I have that Anthony Kennedy has no clue what is going on. And why would he? I think the real issue is why Deutsche Bank doesn't hold the group head (who happens to be Justin Kennedy) accountable rather than trashing two junior traders. The answer is that they don't want to tangle with the anyone in the government or judiciary, particularly since they are a foreign bank.