The trader accused of bringing down Britain’s oldest investment bank by betting the wrong way on the Tokyo market will fight extradition by citing Singapore’s human rights record, his lawyer said Friday.
About $1 billion in trading losses rung up by Nicholas Leeson, 28, drove Baring Brothers and Co. into receivership last week.
Leeson was ordered by a Frankfurt court to remain in pre-extradition custody. He and his 23-year-old wife, Lisa Simms, were arrested Thursday morning at Frankfurt’s airport following a flight from Malaysia. His wife has since been released and gone to Britain.
The ruling by the Frankfurt court came after three Singapore officials delivered an arrest warrant and extradition request for Leeson, who disappeared last week when the Barings losses became known.
The warrant, based on a complaint by the bank, charges Leeson with “forgery for the purpose of fraud,” and carries a maximum sentence of seven years in prison, a Singapore official said.
In the warrant, Singapore authorities allege that Leeson forged a document, confirming a payment of $81 million by a non-existent client, German television reported.
The alleged forged document indicated a U.S. client paid a large sum worth millions of dollars into an account with Citibank in the name of Baring Futures, according to a report Friday in the London Evening Standard.
Neither prosecution nor defense attorneys commented on the reports Friday.
Frankfurt prosecutor Hans-Hermann Eckert said the extradition process could take four months or more to resolve.
Leeson reportedly made wrong bets on which way the Tokyo stock market would go, costing the bank $1 billion and forcing its collapse Sunday.
A Dutch bank, the ING Group, is believed first in line to take over the banking institution that includes Queen Elizabeth among its clients by assuming all its liabilities - for 1 pound, or $1.60
British fraud investigators meanwhile opened their own probe Friday into Leeson’s activities. A British police official was in Frankfurt. Leeson also hired a British lawyer.
Leeson’s German lawyer, Eberhard Kempf, said Leeson would be willing to return home to Britain even if he faced charges there, rather than be extradited to Singapore.
Leeson did not want to go to Singapore “because of the judicial and human rights situation in Singapore,” Kempf said.
“The legal system is not the same, the defense possibilities are difficult to evaluate. I’ve heard of horrible punishment there,” Kempf said.
He said that and Singapore’s human rights record would be “the first point” of his argument to block extradition.
Leeson did not comment on the charges and was not required to do so when he appeared briefly before a judge. “He was only asked for his name and date of birth,” Kempf said.
In Singapore, white-collar criminals may be jailed and fined, but they are not flogged. That punishment is reserved for those convicted of violent crimes, drug trafficking and vandalism, such as American teen-ager Michael Fay, who was caned last year in a case that enraged U.S. officials.