Deutsche Bank tops list of financial institutions that facilitated suspicious transactions

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Deutsche Bank
Credits: Deutsche Bank

Deutsche Bank (NYSE: DB) is facing another scandal involving the flow of suspicious funds or dirty money amounting to nearly $2 trillion around the world between 1999 and 2017.

A leaked document from the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) showed that Deutsche Bank facilitated $1.3 trillion transactions deemed suspicious. It appears that the German investment bank and financial services firm is on top of the list of financial institutions that facilitated dirty money worldwide over almost two decades.

According to DW, in 2019, BuzzFeed obtained a large cache of FinCEN files containing secret reports detailing suspicious financial transactions. The media outlet shared those leaked documents with the International Consortium of Investigative Journalists (ICIJ). More than 400 journalists from 88 countries reviewed the documents.

The Bank Secrecy Act (BSA) requires banks and other financial institutions to report suspicious transactions such as money laundering, tax evasions, or sanctions violations. Financial institutions such as Deutsche Bank submit Suspicious Activity Reports (SARs) to the FinCEN, which is responsible for investigating the transaction flagged as suspicious.  SARs are not necessarily evidence of financial crimes.

Deutsche Bank says it made significant investments to help fight financial crimes

In response to the media reports regarding the issue, Deutsche Bank said the leaked SARs “have already been investigated and led to regulatory resolutions in which the bank’s cooperation and remediation [were] publicly recognized.”

Additionally, Deutsche Bank said it is among the world’s leading financial institutions that invested billions of dollars to help authorities fight financial crimes. Their investment “leads to increased detection levels” and “SARs are alerts of potential issues, not proven facts.”

“At Deutsche Bank, we have devoted significant resources to strengthening our controls and we are very focused on meeting our responsibilities and obligations,” according to the German bank.

Deutsche Bank’s recent scandals

In 2015, Deutsche Bank paid $258 million penalties to settle its violations for doing business with countries subject to U.S. sanctions including Iran, Libya, Myanmar, Sudan, and Syria. Take note that the leaked FinCEN documents showed that the German bank facilitated suspicious transactions even after the 2015 settlement.

In 2017, Deutsche Bank agreed to pay $220 million to settle allegations by multiple states that it rigged the London Interbank Offered Rate (LIBOR) and other benchmark interest rates. Two years before, it paid a record penalty of $2.5 billion to U.S. and U.K. regulators for its role in the LIBOR interest rigging scandal.

During the same year, it agreed to pay $7.2 billion to resolve a federal civil lawsuit alleging that it misled investors regarding its sale of residential mortgage-backed securities.

In July this year, Deutsche Bank agreed to pay $150 million in penalties over its dealings with Jeffrey Epstein, the late billionaire, and sex offender.

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