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Friday, June 1, 2018

ANZ, Deutsche Bank, Citigroup Face 'Cartel' Charges

Corruption is Everywhere - But in Australian and Global Banks?

By Sara Shayanian  

ANZ Bank, Deutsche Bank and Citigroup face criminal charges over alleged cooperation involving the sales of $2 billion worth of ANZ. shares. File Photo by Dan Himbrechts/EPA-EFE

UPI -- Three major financial institutions and several individuals face criminal charges in Australia of cooperating with each other in the sales of about $2 billion worth of stock shares, officials said.

The Australian Competition and Consumer Commission announced the charges against ANZ Bank, Deutsche Bank and Citigroup Friday.

"The charges will involve alleged cartel arrangements relating to trading in ANZ shares following an ANZ institutional share placement in August 2015," ACCC Chairman Rod Sims said in a statement.

"ANZ and the individuals were knowingly concerned in some or all of the conduct."

Cartel behavior occurs when businesses work together, instead of competing, to drive up profits.

ANZ denied it acted unlawfully in the sales of nearly 81 million shares worth $1.9 billion.

The deal was underwritten by Deutsche Bank, Citigroup and JP Morgan Chase as part of a bid by ANZ to raise capital to meet regulatory requirements.

"We believe ANZ acted in accordance with the law in relation to the placement and on that basis the bank intends to defend both the company and our employee," ANZ Chief Risk Officer Kevin Corbally said.

ANZ said the proceedings relate to an arrangement made between lead managers over the supply of bank shares. It noted criminal proceedings will likely be brought against ANZ Group Treasurer Rick Moscati.

Citigroup and Deutsche Bank vowed to "vigorously defend" against the charges. ANZ said it would also fight the accusations against Moscati.

If found guilty, the companies could face maximum penalties of 10 percent of annual turnover, or three times the benefit gained from the crimes. Individuals could face up to 10 years in jail.