Is Christian Bittar’s sudden $17m personal fine fair?
Pity Christian Bittar. The trader, formerly a Deutsche Bank managing director and head of the German bank's money markets and interest rates derivatives group, is being personally fined $17m (£10m) by the U.K. Financial Conduct Authority according to Bloomberg. This follows the clawing back of around $53m in unvested bonuses when Bittar was let go by Deutsche Bank in 2011 for allegedly fixing Libor rates.
The FCA is declining to comment on its precise reason for targeting Bittar, other than that he attempted to manipulate the euro interbank offered rate.
However, Bittar's defenders claim that he's been unfairly scapegoated and that Deutsche itself made a lot of money from his trading activities in the run-up to his expulsion. Bittar's profitability allegedly contributed to the general bonus pool and enriched individuals at the top of the investment bank.
As we reported previously, there are unconfirmed claims that Bittar made audited profits of €1.7bn ($2.32bn) in the five years before he left Deutsche. Bittar himself said to have benefited from his success to the tune of $100m+ (minus the claw back) from his trades. Did others at Deutsche benefit from his success too? And if so, should their bonuses be deducted along with Bittar's?
The bank declined to comment. Deutsche itself has already been subject to a €725m fine from the European Union for manipulating Libor. It's also in the process of conducting an ongoing internal review into the alleged manipulation of interbank offered rates. This shows that, 'no current or former member of the Management Board had any inappropriate involvement in the interbank offered rates matters under review,' and that any malfeasance was entirely down to, 'certain employees, acting on their own initiative.' Anshu Jain has said that he's "sickened" by the whole thing.
Bittar has to carry the can, then. Fortunately, he's still employed by BlueCrest in Singapore after first moving to the island with Deutsche in 2011.