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Frankfurt prosecutors have charged a 48-year-old German citizen with insider trading in one of the country’s largest such cases, as German authorities seek to crack down on the practice, prosecutors told the Financial Times.
The defendants allegedly received confidential information about an upcoming M&A deal from a partner at boutique investment bank Perella Weinberg, and prosecutors allege that the defendants used the inside information in 20 different transactions between 2017 and 2021.
The defendant, who has been in pre-trial detention since January, is said to have made profits of at least 24 million euros. Prosecutors say he also relied on tips for some of his early trades that fell outside the statute of limitations.
Perella Weinberg, a banker who worked on mergers and acquisitions at his London office, was found dead days after police raided the bank’s premises in the UK and Europe. He has been suspended from the bank following the raid.
People familiar with the matter said the two were old friends and were in regular contact.
The investigation, which involves Germany’s financial regulator BaFin, Frankfurt state prosecutors and federal police, highlights German authorities’ growing awareness of insider trading and market manipulation.
This is the third major insider trading scandal involving a large financial institution in Germany since 2021.
Last year, a former Lazard investment banker was given a suspended sentence for sharing confidential information with traders.
In 2021, a former senior fund manager at Union Investment was sentenced to three and a half years in prison and ordered to pay back nearly six times the €8 million in profits he made from insider trading. A retrial is currently underway in Frankfurt after the German Supreme Court found procedural flaws.
Under German law, insider trading is punishable by up to five years in prison.
Perella Weinberg has become one of Germany’s leading M&A advisors. Transactions it has represented include Vonovia’s €29 billion acquisition of Deutsche Wohnen in 2021, the €4.5 billion acquisition of Osram in 2019, and the €59 billion asset swap between RWE and Eon in 2018.
After the January raid, the bank told the Financial Times that it was “assisting the investigation by German law enforcement authorities” and stressed that it was not itself the subject of an investigation and that there were “no indications of any wrongdoing by German law enforcement” . The company. “
The charges were filed in July but had not previously been made public. No trial date has been set, but people familiar with the matter said it could begin early next year.
Lawyers for the 48-year-old defendant declined to comment.
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