Deutsche Bank Wins [pounds sterling]146m Compensation Against Sebastian Holdings' [pounds sterling]5bn Lawsuit [VIDEO].
In the High Court, a judge ruled that Deutsche Bank was not in breach of contract and that Sebastian Holdings would have to pay the financial [pounds sterling]146m (E174m, $235m) in compensation for unpaid margin calls from 2008 to the group.
A margin call is a demand by a broker that an investor deposits more cash to cover potential losses on trades.
Sebastian Holdings tried to claim [pounds sterling]5bn in in losses and missed profits after alleging that Deutsche Bank put through trades which it should not have.
Billionaire investor Alexander Vik said margin calls by Deutsche Bank as markets tanked in the onset of the credit crisis in October 2008 caused him so much stress that he was treated in hospital.
Deutsche Bank told
: "We welcome the court's ruling that the defendant must repay monies owed on a margin call since 2008, and its findings that the defendant's allegations were contrived and without merit and based on fabricated evidence and false testimony."
Sebastian Holdings had $1bn of its equity wiped off its balance sheet in October 2008.
Sebastian Holding faced $511m in margin calls but the group claimed that Deutsche Bank put through these trades, unauthorised, and should not have been booked. It also claimed the bank failed to inform it that the collateral needed to guarantee the high-risk trades would exceed a pre-arranged $35m limit.
"I am an investor, a long-term investor ... but financial products are very difficult to understand. It's not possible for me to have product knowledge," said Vik during the trial.
Norewegian billionaire Vik studied economics at Harvard University and spent 10 years working as a stock broker before setting up his own businesses.
The case is Deutsche Bank AG v. Sebastian Holdings Inc., High Court of Justice, Queen's Bench Division, Commercial Court, 09-83.
|Printer friendly Cite/link Email Feedback|
|Publication:||International Business Times - US ed.|
|Date:||Nov 8, 2013|
|Previous Article:||AVB Suggests Record-Breaking Striker Has Future at Tottenham.|
|Next Article:||QBE International: England v Argentina, Where to Watch Live, Preview and Team News.|