Deutsche Bank threatened with fines for controlling money laundering


Germany’s top financial watchdog has threatened to fine Deutsche Bank AG if it fails to implement anti-money laundering checks within a set deadline, suggesting the regulator is unhappy with efforts of the bank to control the flow of dirty money.

BaFin, as the regulator is known, said on Friday evening that on September 28 it had asked Deutsche Bank to take specific measures to prevent money laundering and terrorist financing in order to be able to fulfill demands that BaFin had made in 2018 and 2019. The regulator said it would impose financial penalties if the bank failed to comply.

Last year, the regulator expanded the role of a monitor he was appointed in 2018 to oversee implementation, showing he was still unhappy with progress.

Deutsche Bank must meet the deadlines by mid-2023.

A bank spokesman said there were no new findings in the latest order. “We are fully aligned with BaFin on the necessary measures and have already achieved a large part of them,” he added.

BaFin’s latest warning adds pressure on CEO Christian Sewing, who since taking over the bank in 2018 has tried to steer it away from scandals and focus on operations. Last week he reported a jump in profit in the third quarter as rising interest rates improved its lending activity. Costs, however, remain under pressure, in part due to the bank’s spending to strengthen internal controls.

Past issues with regulators include paying fines in the United States for failing to properly monitor transactions with late financier and convicted sex offender Jeffrey Epstein and for its role as correspondent bank for the Estonian branch of Danske Bank A/S, where some $230 billion has been transferred from Russia and other former Soviet states over the years with little oversight.

Deutsche Bank also set up monitors as part of a 2017 settlement with New York state authorities over “mirror trades,” in which the bank moved 10 billion dollars of money from Russian customers Out of the country.

Following Russia’s invasion of Ukraine, Deutsche Bank said it would withdraw from the country.

Write to Patricia Kowsmann at [email protected]


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