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Deutsche Bank offices under money laundering investigation
The logo of Deutsche Bank is seen in front of one of the bank's office buildings in Frankfurt, Germany, October - Photo: Kai Pfaffenbach/REUTERS

Deutsche Bank offices under money laundering investigation

29/11/2018
15:47
Reuters
Frankfurt
Arno Schuetze & Tom Sims
-A +A
Police raided six Deutsche Bank offices in and around Frankfurt over money laundering allegations linked to the “Panama Papers,” the public prosecutor’s office in Germany’s financial capital said

Police raided six Deutsche Bank offices in and around Frankfurt on Thursday over money laundering allegations linked to the “Panama Papers,” the public prosecutor’s office in Germany’s financial capital said.

Investigators are looking into the activities of two unnamed Deutsche Bank employees alleged to have helped clients set up offshore firms to launder money, the prosecutor’s office said. It focuses on the years 2013 through to 2018, a spokeswoman for the prosecutor’s office said.

Around 170 police officers, prosecutors, and tax inspectors searched the offices where written and electronic business documents were seized.

“Of course, we will cooperate closely with the public prosecutor’s office in Frankfurt, as it is in our interest as well to clarify the facts,” Deutsche Bank said, adding it believed it had already provided all the relevant information related to the “Panama Papers.”

The news comes as Deutsche Bank tries to repair its tattered reputation after three years of losses and a drumbeat of financial and regulatory scandals.

Christian Sewing was appointed as Chief Executive in April to help the bank to rebuild. He trimmed U.S. operations and reshuffled the management board but revenue has continued to slip.

The investigation was triggered after investigators reviewed so-called “Offshore-Leaks” and “Panama Papers”, the prosecutor said.

The “Panama Papers,” which consist of millions of documents from Panamanian law firm Mossack Fonseca, were leaked to the media in April 2016.

The prosecutors said they are looking at whether Deutsche Bank may have assisted clients to set up offshore companies in tax havens so that funds transferred to accounts at Deutsche Bank could skirt anti-money laundering safeguards.

In 2016 alone, over 900 customers were served by a Deutsche Bank subsidiary registered on the British Virgin Islands, generating a volume of EUR$ 311 million, the prosecutors said.

They also said Deutsche Bank employees are alleged to have breached their duties by neglecting to report money laundering suspicions about clients and offshore companies involved in tax evasion schemes.

Prosecutors began the investigation in August.

It is separate from another money laundering scandal surrounding Danske Bank, where Deutsche Bank is involved.

Danske is under investigation for suspicious payments totaling EUR$ 200 billion from 2007 onwards and a source with direct knowledge of the case said Deutsche Bank helped to process the bulk of the payments.

A Deutsche Bank Executive Director has said the lender played only a secondary role as a so-called correspondent bank to Danske Bank, limiting what it needed to know about the people behind the transactions.

Weaknesses in Deutsche Bank’s controls that aim to prevent money laundering have caught the attention of regulators on both sides of the Atlantic.

The bank has publicly said that it agreed it needed to improve its processes to properly identify clients.

sg

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