(Reuters) — Deutsche Bank AG has been sued for $150 million by a former trader whose conviction for rigging the Libor interest rate index was overturned, who says the bank accused him of shielding top executives from debt.
In a complaint filed Thursday in New York, Matthew Connolly accused the bank of “malicious prosecution” for making materially false statements to the U.S. Department of Justice and soliciting an employee to lie at trial.
Mr Connolly said the German lender saw him as the “perfect fall guy” even though he had “almost nothing to do” with Libor, to isolate executives who led its Libor manipulation.
Deutsche Bank’s scapegoat destroyed Mr. The reputation and career of Connolly, a married father of two, and caused “the destruction of his life,”; the complaint said.
The bank said in a statement: “We will vigorously defend ourselves against these claims.”
Libor is an abbreviation for London interbank offered rate.
Before it was phased out in January, it backed hundreds of trillions of dollars of financial products including credit cards, mortgages and other loans.
Investigations worldwide into Libor manipulation resulted in around $9 billion in bank fines, including $2.5 billion for Deutsche Bank in 2015.
Mr. Connolly had headed Deutsche Bank’s pool trading desk in New York before leaving in 2008.
He and London-based colleague Gavin Black were charged in 2016 and convicted in 2018 of rigging Libor, with Mr. Connolly sentenced to six months of house arrest and fined $100,000.
A US appeals court overturned their convictions in January, however, citing a lack of evidence that they were guilty.
The case is Connolly v Deutsche Bank AGUS District Court, Southern District of New York.