AFP - Hong Kong's graft watchdog is probing a major fraudulent trading case after arresting 11 people, including two senior executives at Deutsche Bank, reports said Friday.

The duo were detained after the Independent Commission Against Corruption (ICAC) launched an operation on Tuesday following a corruption complaint.

"The two have been arrested but no charges have been made, and Deutsche Bank is helping the ICAC with its inquiries," Dow Jones Newswires reported, quoting a person familiar with the case.

The two are suspected of conspiring to accept payment from an investor and others for quoting favourable prices to them in their trading of the bank's derivative warrants.

Local media have reported that the ICAC is investigating staff at Deutsche Bank, and said the profits made by those involved in the case amounted to HK$10 million ($1.3 million).

The bank denied any irregularities in trading and refused to confirm the involvement of its employees.

"Deutsche Bank's Hong Kong warrant business is operating normally and we are fully committed to meeting client market requirements," Michael West, a spokesman from the Hong Kong branch of the German banking giant told AFP.

"There has been no suggestion of any misconduct by Deutsche Bank. We don't comment on bank employees as a matter of policy," he added.

The ICAC said the suspects arrested in "Operation Leap Over" include two licensed representatives of a securities firm, a stock investor and six others.

They are also being probed for conspiring to defraud the bank and the public "by creating a false or misleading appearance of active trading in the derivative warrants issued by the bank", the commission said.

"The investigation is ongoing and we cannot disclose any further information at this point," a spokeswoman from the ICAC told AFP Friday, refusing to confirm the involvement of Deutsche Bank's staff.

The Securities and Futures Commission, the city's regulator for financial markets, also declined comment.