SYDNEY (Reuters) - Two former senior executives of investment bank JPMorgan Chase & Co (JPM.N) in Australia were named on Wednesday as prosecution witnesses in a criminal cartel case by the state against rivals Citigroup (C.N) and Deutsche Bank (DBKGn.DE).
A senior investigator at antitrust regulator the Australian Competition and Consumer Commission (ACCC) was also named in a court hearing as a witness in the country’s biggest prosecution of alleged white collar crime.
The investment banks are accused of colluding over a A$3 billion ($2 billion) capital raising.
The local units of JPMorgan, Citi and Deutsche all worked on a share issue for the country’s then third-largest bank Australia and New Zealand Banking Group Ltd (ANZ.AX) in 2015.
Last year, the ACCC brought charges against Citi, Deutsche, ANZ and several of those companies’ top employees alleging they colluded to keep from regular shareholders the fact that the issue was undersubscribed.
The previously undisclosed involvement of witnesses who worked at JPMorgan, which was not charged, raises the chances the case will involve global investment banks testifying against each other when it goes to trial, as well as defending themselves against government prosecutors.
The lawyer for Citi’s former Australia head, Stephen Roberts, named as witnesses Richard Galvin, JPMorgan’s former head of equity and derivative capital markets, and Jeffrey Herbert-Smith, JPMorgan’s former managing director and head of markets, in an application to be allowed to cross-examine them.
Roberts’ lawyer, Robert Dick, told the court he wanted to question the two ex-JPMorgan people on written statements about Roberts’ participation in a phone call at the time of the capital raising.
Herbert-Smith’s statement gave only limited detail about Roberts’ involvement in the phone call while Galvin’s statement made “no reference to Mr Roberts saying anything at all”, Dick told the court.
“Is this a case that says ‘by silence Mr Roberts is said to have consented to something’?” Dick said.
“We should be entitled to know.”
Between the two witness statements, “there’s not a shred of material that explains to us what that involves,” Dick said.
A JPMorgan spokesman declined to comment, while Galvin and Herbert-Smith did not respond to requests for comment on LinkedIn. Both left the bank in 2016.
Lawyers for Citi, Deutsche and ANZ also said they want to cross-examine the ACCC’s general manager of financial services competition, Leah Won, also named publicly as a witness for the first time. An ACCC spokeswoman declined to comment on Won’s behalf.
Prosecution lawyers said they would respond to requests to allow their witnesses to be cross-examined when the matter returns to court on Sept. 27.
All the people and companies charged in the case have said they will plead not guilty, but no trial date has been set.
Reporting by Byron Kaye; Editing by Muralikumar Anantharaman