Deutsche Bank Faces €500M Lawsuit for FX Scandal

deutsche bank faces e500m lawsuit for fx scandal

Sumary of Deutsche Bank Faces €500M Lawsuit for FX Scandal:

  • Deutsche Bank is facing a massive €500 million lawsuit slapped by Spain’s seventh-largest hotel chain, Palladium Hotel Group, for alleged misselling of complex and risky foreign exchange (forex) derivatives.
  • Loss Making TransactionsThe hotel operator made 259 derivatives transactions facilitated by Deutsche by 2019. The outstanding notional amount of the contracts at the peak of the transaction in 2017 touched €5.6 billion, the lawsuit detailed.
  • Deutsche touted the forex derivatives contracts to be a safe hedge for forex fluctuations and changed in interest rates.
  • However, the hotel chain ended up in mounting losses and fees and had to cover them with ‘substantial loans’.
  • The German bank even restructured the loss-making derivatives investments for the hotel, charging more fees.
  • Suggested articlesEarn Passive Income Cloud Mining with USDminerGo to article >>The deals between the bank and the hotel were fixed by the broker of Palladium’s founder.

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