Tokyo Financial, Commerzbank Sued for $2.5 Million

By on March 5, 2010

A group of 46 Japanese individual investors sued the Tokyo Financial Exchange Inc. and Germany’s second-biggest bank Commerzbank AG for inappropriate pricing of South frica’s rand versus the yen.
The investors are seeking 221 million yen ($2.5 million) for losses they suffered as a result, said Tetsuro Arai, an attorney at Tokyo-based Aoi Law Office who represents the investors. The suit was filed to the Tokyo District Court on friday the 26th February 2010.

Commerzbank made bids about 30 percent below market for the South African currency versus the Japanese yen just before the close of trade on the morning of Oct. 31. The Tokyo Financial Exchange fined the Frankfurt-based bank 3 million yen on Dec. 21 and banned it from market-making services until Jan. 3 for breaching rules banning the offering of prices that “deviate sharply” from the market and “inappropriate system risk management.”
The bank has sought to place additional preventive measures since the incident, Frankfurt-based spokesman Reiner Rossmann said Nov. 21.
The 46 investors weren’t covered by relief that Tokyo Financial adopted for some of the individuals affected by the incident, Arai said.
Tokyo Financial Exchange will discuss how to respond as soon as it receives the complaint, spokesman Hideaki Kamata said. Chieko Hara, a compliance officer at Commerzbank in Tokyo, declined to comment and directed inquires to the Frankfurt head office

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