Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Leeson 'Likely' to Be Extradited

FRANKFURT, Germany -- Former Barings Bank trader Nick Leeson moved a step closer to extradition when a German court ordered him to stay in custody while it reviewed Singapore's request that he be returned to face trial.


Leeson's risky trading in Japanese stock futures when he worked for the British investment bank in Singapore is blamed for the collapse of Barings through $1 billion in losses.


"The likelihood that he will be extradited is now greater," Frankfurt prosecutor Hans-Hermann Eckert told a news conference called Tuesday to announce that the court had preliminarily accepted part of the 12 charges made in Singapore's formal bid for the Briton.


Singapore authorities have said the document details 12 counts of forgery and cheating against Leeson, 28, each punishable by seven years in prison if he is convicted.


Meanwhile, ING Group, a Dutch banking and financial conglomerate that purchased the remnants of Barings, sacked at least 20 executives in London, Tokyo and Singapore on Monday. They were linked to Leeson, who is blamed for the collapse in February of the 232-year-old bank.


Among those ousted was James Bax, who Singapore investigators said tried to blow the whistle on Leeson as he moved into a new position in 1992 that allowed him to report directly to London.


Bax warned his superiors about the lack of oversight: "My concern is that we are ... setting up a structure which will subsequently prove disastrous.''


The German regional high court in Frankfurt ruled that Singapore authorities had presented sufficient evidence backing its initial charge that Leeson, desperate to raise cash, forged documents for a fictitious deal with a Wall Street firm.


But the 11 additional charges against Leeson arrived in English and could not be verified by the court until they were translated, Eckert said. He did not elaborate.


He also said a final court ruling would take "several months," adding that the decision must be approved by the federal government in Bonn.


Sources familiar with the case have said some of the counts against Leeson allege he ordered the transfer of $80 million from a Barings customer account to his own trading account.


He then forged documents to create the fictitious transaction with the Wall Street firm Spear, Leeds & Kellogg in the original charge, the sources said.


Eckert said the Singapore request included a sworn statement from the firm's managing director, Richard Hogan, that he had not authorized any trade, as Leeson had said.


More charges alleged Leeson illegally ordered the transfer of funds from the Singapore office to a Barings Japan account he used for stock futures trading after inflating the account's profits in Barings' computers through bogus deals. (Reuters, AP)