The SEC is investigating Deutsche Bank over trades by a unit overseen by a hot shot trader

Deutsche Bank is being probed by the SEC over mortgage securities it traded in 2013.

The regulator is investigating whether Deutsche Bank inflated the value of securities at the time and hid trading losses, according to Bloomberg’s
Matt Scully, who first reported the investigation.

“We are cooperating with this investigation, which is looking into previously recognised losses on certain positions,” a Deutsche Bank spokesperson said.

Troy Dixon, who left the bank in 2013 and has since launched a hedge fund, oversaw the positions at the time.

He was named one of Institutional Investor’s “hedge fund rising stars” in 2015, and has won a handful of other awards as well.

As Bloomberg’s Scully notes, delaying bond write-downs could have cushioned the firm’s quarterly earnings results at a time the fixed-income market was collapsing and trading businesses were suffering across Wall Street.

Dixon’s hedge fund, Hollis Park Partners, declined to comment.

Read the full story on Bloomberg»

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