An Ugly Story Of The Unbridled Arrogance And Downfall of An Investment Bank

This week, it was officially announced that18,000 people would be laid offby Deutsche Bank. These are real people with spouses, partners and children. They have mortgages to pay, college tuition bills and retirements to plan for. Some may easily find new jobs, many will struggle, others could be left lost without any prospects, eating into their savings and, perhaps, never finding another job at their level of compensation. 

On the same day that layoffs began, a photographer snapped a photo of two impeccably dressed gentlemen who were believed to have been fired investment bankers carrying their belongings out of the building. The photo evoked the same feeling as a preceding poignant Wall Street memory—imagesof sad and angry Lehman Brothers employees leaving their offices, schlepping boxes with their personal effects, as the bank was shutting down in the midst of the financial crisis. It was later detected by internet sleuths that the two men were actually tailors. They were summoned to the Deutsche Bank offices by investment bankers—who were obviously not affected by the downsizings—to fit them for custom $1,800 suits.

Deutsche Bank CEO Christian Sewing supposedly reprimanded the executives for having their custom, bespoke suits tailored on the same day that thousands of employees were given notice of their termination. Sewing said in an interview with the German newspaperHandelsblatt, “That someone would let a tailor come on such a day is disrespectful. In no way is this behavior in keeping with our values.” 

This, in a nutshell, is the problem with Wall Street—its sheer arrogance. What type of creature would summon up a tailor for a fitting when literally thousands of their colleagues are losing their jobs and livelihoods? Although, if you do a modicum of research, it should come as no surprise. In fact, contrary to CEO Sewing’s comment about “values,” Deutsche Bank’s actions, involving  allegedly violating rules and regulations globally for decades and fined billions of dollars, is exactly in line with the investment bankers’ tone-deaf attitude. The bank has an illustrious history of wrongdoing and a blatant disregard for moral practices.

’s rise to power, Deutsche Bank dismissed its three Jewish board members in 1933. Deutsche Bank seized Jewish-owned businesses, provided banking for the Gestapo and loaned the money to build the Eric Ben-Artzi and Matthew Simpson claimed that, during the financial crisis, Deutsche failed to recognize about $12 billion of paper losses on their $130-billion portfolio of leveraged trades.The whistleblowers alleged that if the bank had properly accounted for its positions, its capital would have fallen to the extent that it might have needed a government bailout. One of them claimed that "if Deutsche had marked its books, it might have been in the same position as Lehman," which translates to Deutsche Bank could have been forced into insolvency. Six former Deutsche employees were accused of being involved in amajor tax fraud deal with CO . The amount of money involved in the alleged scheme may have been as high as  €850 million. covert espionage on its critics alleged that Deutsche Bank prepared a list of names of people who it wanted to investigate for criticizing the bank.

In 2015, Deutsche Bank agreed to a combined $2.5 billion in fines—a $2.175 billion fine by American regulators and a €227 million penalty by British authorities—for its involvement in the in June 2012. The company also pleaded guilty to wire fraud, acknowledging that at least 29 employees had engaged in illegal activity.   with the U.S. Department of Justice over its sale and pooling of toxic mortgage securities in the years leading up to the 2008 financial crisis. As part of the agreement, Deutsche Bank was required to pay a civil monetary penalty of $3.1 billion and provide $4.1 billion in consumer relief, such as loan forgiveness.  In November 2015, Deutsche Bank was ordered to pay imposed by the New York State Department of Financial Services and the U.S. Federal Reserve Bank after the bank was caught doing business with Burma, Libya, Sudan, Iran and Syria, which were under U.S. sanctions at the time.  

These are the real values of Deutsche Bank. The bank’s history shows that it’s perfectly normal for wealthy investment bankers to get their expensive suits tailored on the very same day that their colleagues are losing their jobs. Spanning decades, the bank has arrogantly engaged in one heinous activity after another with impunity. Deep pockets enabled them to pay the fines and continue doing business. When this happens, it's easy for bankers to feel invincible. When you believe that you are untouchable, you will do unspeakable things to others. It's a sad commentary of the bank’s business practices and values.

Source: Forbes.com

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