NRI stock trader suspended in Britain
Anshul Rustagi, an IIM graduate, allegedly overstated his profits.india Updated: Jan 10, 2006 22:50 IST
A stock trader of Indian origin, Anshul Rustagi, who operated on behalf of the Deutsche Bank in London, has been suspended.
Rustagi, an Indian Institute of Management (IIM) graduate, was reportedly dealing in a market for securities known as collateralised debt obligations, or CDOs.
He faces disciplinary action for allegedly overstating his profits by £30 million.
Reports say that Rustagi dealt largely in iTraxx indices - derivatives that reflect a basket of credit default swaps. A colleague, managing the desk while Rustagi was on holiday, reportedly discovered the losses.
The bank's trading volumes in iTraxx indices reportedly doubled in the past year, as have those of many other banks, which hedge and bet on the likelihood of corporate bond issuers defaulting.
As first revealed in The Times, Rustagi was suspended after allegedly overstating profits on his own book.
Although no client seemed to have lost money in the alleged incident and the probe is not criminal, FSA, the financial services regulator has been informed.
Rustagi was said to be a brilliant student at IIM, where he was runner-up in the 'Leaders in Making' award. He graduated in 2003.
Deutsche Bank preferred not to comment while Rustagi could not be contacted.