Tuesday, October 27, 2020

Deutsche Bank Acknowledges Lapse in Checks on Money Laundering


Deutsche Bank on Monday acknowledged a lapse in its money laundering controls, underlining the bank’s continuing struggle to move beyond a series of scandals that have helped push its stock price to a record low.

An internal audit uncovered deficiencies in the way that the bank processed checks on behalf of clients, Deutsche Bank said in a statement. The audit, which examined the bank’s operations in Britain, did not find any cases of money laundering or breaches of international sanctions that occurred because of the lapses, the bank said.

Deutsche Bank issued the statement after The Financial Times reported that checks processed on behalf of three large corporate clients were supposed to be screened by two employees but instead received only a cursory review by one worker.

The bank, which did not deny the report, said it was working to improve its technology to prevent financial crimes. “We continue to invest substantially” in better controls, it said.

Deutsche Bank has repeatedly come under fire for not doing enough to avoid being a conduit for dirty money and has had a series of embarrassing disclosures about sloppy screening procedures.
- Advertisement -

Last month, the bank said it had found flaws in software used for years to identify cases of possible money laundering. The bank said no suspicious transactions had slipped through as a result.

In November, German law enforcement authorities searched Deutsche Bank headquarters in Frankfurt as part of an investigation into whether bank employees had helped customers use offshore tax havens to transfer money obtained illegally.

Christian Sewing, the Deutsche Bank chief executive, told shareholders last month that the bank had not found evidence of wrongdoing by its employees.

The New York Times recently reported that anti-money-laundering specialists at the bank recommended in 2016 and 2017 that multiple transactions involving legal entities controlled by Donald J. Trump and his son-in-law, Jared Kushner, be reported to a federal financial-crime watchdog.

- Advertisement -

But Deutsche Bank, which has lent billions of dollars to the entities controlled by Mr. Trump and Mr. Kushner, never filed such reports.

The damage to the bank’s reputation, along with meager profits, has shaken investors and helped push Deutsche Bank shares to a record low. The shares closed at 5.97 euros Friday, just 1 cent above the previous record low of 5.96 euros a day earlier. Stock markets in most of Europe were closed Monday for the Pentecost holiday.

The most recent lapses in money-laundering controls were disclosed a few days after Deutsche Bank acknowledged that German prosecutors had widened a long-running tax-fraud investigation to include present and former members of the management board.

Deutsche Bank said in a statement Friday that prosecutors had added the names because the statute of limitations was about to run out. The prosecutors wanted to preserve their ability to pursue other suspects. Deutsche Bank said it “did not participate” in the so-called cum-ex scheme, in which people claimed refunds for dividend taxes they had not paid.

A Deutsche Bank spokesman declined to name anyone or comment on news reports that one of them is Garth Ritchie, the head of the investment banking unit.

A spokesman for the state’s attorney in Cologne, which is handling the tax fraud investigation, declined to comment.


Julius Baer to deny two former CEOs their bonuses over money laundering scandal

Julius Baer will withhold millions of francs in bonuses from its former chief executives Boris Collardi and Bernhard Hodler, as a result of a...

Goldman Sachs executives to cover part payments of $3 billion fines in 1MDB scandal

Nine current or former Goldman Sachs executives, including CEO David Solomon, will have to pay back hundreds of millions of dollars in compensation over...

Goldman Sachs agrees $3 billion settlement with US DoJ over 1MDB corruption scandal

Goldman Sachs has agreed to pay nearly $3bn (£2.3bn) in the US to end a probe of its role in Malaysia's 1MDB corruption scandal. The...

Hong Kong fines Goldman Sachs $350 million over 1MDB scandal

Goldman Sachs ignored multiple red flags over the multibillion-dollar fundraisings it arranged for state fund 1Malaysia Development Berhad, Hong Kong’s financial regulator said on...

Texas attorney general Ken Paxton fires top aide who accused him of bribery

Lacey Mase, one of the top aides who accused Texas Attorney General Ken Paxton of crimes including bribery and abuse of office, has been fired, she told The...

Subscribe For More

Get our daily notification on the latest financial crimes news around the World


Latest News

This Week

Crown Resorts chairman Helen Coonan admits casino ‘enabled’ money laundering

Crown Resorts chairman Helen Coonan has conceded the casino giant facilitated money laundering at its Melbourne casino, but blamed it on "ineptitude" rather than...

Brother of ex-Pakistan PM Nawaz Sharif jailed for money laundering

Pakistan Muslim League-Nawaz (PML-N) chief and Opposition Leader in the National Assembly Shehbaz Sharif was sent to jail on Tuesday in a money laundering...

Former Malawi minister sentenced to six years in prison over passport corruption scandal

A court in Malawi’s capital Lilongwe on Thursday sentenced a former home minister to six years in prison after he was found guilty in...

Operators of fake theology school accused of stealing $12 million in student aid

Six people from three states are charged with defrauding $12 million from federal student aid programs by allegedly enrolling students into a theology school...

Adblock Detected!

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by whitelisting our website.

Enable Notifications    Ok No thanks