Yonhap news agency said the German bank's Seoul securities unit and also the four workers -- including three foreigners -- were accused of amassing forty-four. 8 billion won ($41. 3 million) through illegal trading on the place and futures markets.
Deutsche Bank said in a statement that it refused the charges and would defend itself in court, according to Dow Jones Newswires. The financial institution said it did not authorise or condone any breach of market legislation.
The bank's Hong Kong unit and securities unit in Seoul have already been under investigation for alleged market manipulation and unfair transactions last November 11, a good options expiry day.
On that day Seoul's benchmark KOSPI share index fell a hefty 48 points within the session's last 10 minutes due to arbitrage trading between the spot as well as futures markets.
During that time about 2. 4 trillion won ($2. sixteen billion) in sell orders from foreign investors were processed, most of all of them through Deutsche Bank's local securities unit.
The KOSPI ended the day 53. 12 factors, or 2. 79 percent, lower at 1, 914. 73.
Prosecutors said Deutsche Bank's securities unit in Seoul and the four workers knowingly placed heavy sell orders in order to pocket massive returns from put options, which were structured to generate profits when the KOSPI plunged.
"All profits they made illegally have been confiscated by the actual court, " Yonhap quoted Lee Seok-Hwan, a chief prosecutor on the situation, as saying.
South Korea's securities market -- the world's largest in terms of amount of stock index options trading -- saw its stability and transparency "seriously damaged" through the scheme, he said.
Yonhap said three of the four charged employees had been foreign and included an executive in Hong Kong, while the fourth was a South Korean executive from the bank's securities unit in Seoul.
The four have refused summonses by prosecutors, who intend to ask Hong Kong authorities and Interpol to help extradite them if they won't appear in court, the agency said without specifying their current locations.
Southern Korea, in common with other developing markets, has grown increasingly concerned in the potential risks posed by rapid flows of foreign capital.
In January local authorities announced new rules made to reduce the risk of sharp stock market volatility triggered by derivatives buying and selling.
In February Seoul financial authorities suspended some local Deutsche Bank operations for 6 months over the alleged market manipulation, the toughest-ever penalty imposed against a international securities firm.