Deutsche Börse to pay fine of €10.5m

The Irish Times - Business - - NEWS -

Deutsche Börse chief ex­ec­u­tive Carsten Kengeter is set to per­son­ally pay a penalty of about €500,000 as part of the ex­change’s plan to swiftly end the long-run­ning in­ves­ti­ga­tion into his al­leged in­sider trad­ing.

The group, Europe’s largest bourses op­er­a­tor by mar­ket cap­i­tal­i­sa­tion, made its move to end the seven-month in­quiry late on Wed­nes­day by agree­ing to pay penal­ties to­talling €10.5 mil­lion.

It also said it would not dis­cuss whether it would re­new Mr Kengeter’s con­tract – which ex­pires in March next year – un­til af­ter all the reg­u­la­tory in­ves­ti­ga­tions trig­gered by the episode had been con­cluded.

The Frank­furt pros­e­cu­tor has pro­posed two fines, €5 mil­lion re­lated to the in­sider trad­ing in­ves­ti­ga­tion and €5.5 mil­lion re­lated to an al­leged fail­ure to dis­close mar­ket-sen­si­tive in­for­ma­tion be­fore Deutsche Börse pub­licly con­firmed plans to merge with the London Stock Ex­change Group (LSEG) in early 2016.

The deal was blocked by Euro­pean an­titrust reg­u­la­tors this year.

Mr Kengeter’s pay­ment is in ad­di­tion to the €10.5 mil­lion penalty. His spokesman de­clined to com­ment.

Raided his home

In Fe­bru­ary author­i­ties raided Mr Kengeter’s home and of­fice as part of the in­quiry into his pur­chase of 60,000 shares worth about €4.5 mil­lion in De­cem­ber 2015, weeks be­fore for­mal talks be­tween Deutsche Börse and the LSEG be­gan. When the news be­came pub­lic in Fe­bru­ary 2016, shares in both ex­changes rose.

The share pur­chases were part of the com­pany’s long-term in­cen­tive scheme and can­not be sold un­til 2019. Mr Kengeter has con­sis­tently de­nied any wrong­do­ing.

In agree­ing to set­tle, Deutsche Börse said it as­sumed the in­ves­ti­ga­tion into Mr Kengeter would be closed, sub­ject to ad­di­tional con­di­tions be­ing ap­proved.

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