Deutsche Bank has suspended an employee for “improper communication” with the Monetary Authority of Singapore. This comes after a wide ranging investigation by large investment banks into suspected employee rigging of the foreign exchange market.
There are a couple of interesting aspects to this case. First, according to the article, Deutsche Bank informed MAS of this decision and reasons behind this decision, but MAS has so far opted not to disclose this to the public. Given that the other central bank notified of potentially improper behavior, the Bank of England, “suspended a staff member” and hired an outside law firm to conduct a full investigation, it is troubling that MAS has so far avoided any disclosure of this event or outside investigation.
Second, as Deutsche Bank suspended the employee for “improper communication” with MAS, this implies some type of unethical behavior by MAS or an employee of MAS. The report does not say that the employee passed on sensitive information to other DB employees, other banks or traders. While MAS may be faultless, it is likely given what is known so far that there is some improper behavior by MAS or an employee of MAS.
Third, given that MAS has announced its investigation of potential foreign exchange market manipulation, it presents a clear conflict of interest to both be investigating and the investigated. I have absolutely no sympathy for banks or traders that attempt to manipulate market prices, however, I harbor similar levels of disdain for bodies that investigate themselves and find themselves clean.
Why listen to me though, I am just an academic and a quack according to the Singaporean powers that be