(Bloomberg) -- Deutsche Bank AG compensated a Spanish company for losses the firm made after purchasing foreign-exchange derivatives from the German lender, people familiar with the matter said.
Deutsche Bank paid the wine-maker J Garcia Carrion more than 10 million euros ($12 million), the people said, who asked not to be named as the matter isn't public. The lender sent a delegation to Madrid late last year to negotiate the deal, and it also apologized for the behavior of its sales people and traders, the Financial Times reported earlier.
Representatives of Deutsche Bank and JGC declined to comment.
The German lender has kicked off an investigation into alleged mis-selling of foreign-exchange derivatives to Spanish companies, known as Project Teal, after the firms complained that the derivatives had saddled them with deep losses even though they had purchased them to hedge risks, a person familiar with the matter has said. Two senior Deutsche Bank executives -- the former global head of FX, Jonathan Tinker, and the ex-head of the wind-down unit, Louise Kitchen -- have subsequently left the bank, Bloomberg News has reported.
Earlier this month, JGC filed a complaint against Goldman Sachs Group Inc's international unit with the U.K.'s Financial Conduct Authority. The complaint alleges that the U.S. bank “incited the sale of unauthorized speculative derivatives unconnected to Garcia Carrion's business, with obscure implicit fees, and without regard to the relevant regulation relating to communicating risks and the volume of the client's business,” a spokesman for the company said in an emailed statement.
Goldman Sachs, which is fighting the claims and has denied any wrongdoing, had already sued JGC in the U.K in September in order to recover $6.2 million it says the Spanish firm owes it, according to a court filing.
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