Eric Ben-Artzi, a former risk officer at Deutsche Bank, has declined his share of a $16.5m whistleblower award from the US Securities and Exchange Commission (SEC), arguing that the regulator failed to hold senior executives accountable for the bank's misconduct.
Ben-Artzi, who was fired after raising concerns about Deutsche Bank's inflated valuation of credit derivatives, said the SEC's $55m fine punished shareholders and staff rather than those responsible. In an opinion piece for the Financial Times, he requested that his portion of the award—$8.25m—be given to the bank and its stakeholders.
Ben-Artzi criticised the SEC for not taking action against top executives, who he said retired with multimillion-dollar bonuses based on misstated balance sheets. He also pointed to a 'revolving door' between Deutsche Bank and the SEC, citing several former bank lawyers who later held senior SEC roles, including Robert Rice and Robert Khuzami. He added that SEC Chair Mary Jo White, who has known these individuals for decades, bore ultimate responsibility for the fine.
Andrew Ceresney, director of the SEC's enforcement division, defended the action, stating that all charges supported by evidence and law were brought and unanimously approved by the Commission. Ben-Artzi, now vice-president at BondIT, said he needed the money but would not 'join the looting' of shareholders. He would only accept the award if it were clawed back from executive bonuses.
