Panama
German prosecutors raided several Deutsche Bank offices in the
Frankfurt area Thursday over suspicions of money laundering based
on revelations from the 2016 “Panama Papers” data leak.
Frankfurt prosecutors said they were investigating allegations
that Germany’s biggest lender helped clients set up offshore
companies in tax havens to “transfer money from criminal
activities” to Deutsche Bank accounts.
The latest raid was a new blow to the financial institution that
has been hammered by a string of scandals linked to its pre-2008
crisis attempts to compete with Wall Street investment banking
giants.
Some 170 police officers and investigators from the Frankfurt
prosecutor’s office were searching six of the bank’s premises in
and around the city, the prosecutors said in a statement.
Deutsche Bank said it was “fully cooperating” with the
authorities on the case which it said was “related to the Panama
Papers”.
The Panama Papers scandal that erupted in 2016 with a massive
data leak from Panamaian legal firm Mossack Fonsenca exposed
large-scale tax avoidance, laying bare how the world’s wealthy and
powerful stashed their assets in offshore businesses.
Deutsche Bank was among hundreds of financial institutions whose
names cropped up in the media reports.
The Frankfurt prosecutors said their probe was focussing on two
Deutsche Bank employees aged 50 and 46, as well as “several”
unnamed senior staff members.
Based on information from the Panama Papers, they are accused of
“failing to report suspicions of money laundering” linked to
offshore firms involved in tax evasion “even though there was
sufficient evidence” to suggest illegal activity, prosecutors
said.
Shares in Deutsche Bank fell 2.7 percent to 8.36 euros by 1000
GMT, against a DAX blue-chip index up 0.6 percent.
– ‘Lax money laundering checks’ –
The raids are the latest embarrassment for embattled Deutsche Bank,
which has repeatedly been rapped by regulators for lax money
laundering controls.
In September, Germany’s financial supervisor BaFin took the
unusual step of embedding auditors from KPMG at Deutsche to monitor
the bank’s progress in battling illegal transactions such as money
laundering, terrorist financing and dealings with organised
crime.
In 2017, Deutsche already had to pay a fine of almost $630
million after an investigation by British and American authorities
into laundering of money originating in Russia.
Soon afterwards, the US Federal Reserve ordered a further fine
of $41 million over gaps in the bank’s money laundering
surveillance.
Deutsche Bank has also come under scrutiny over its activities
as a correspondent for scandal-plagued Danske Bank, Denmark’s
largest lender.
Citing people familiar with the matter, Bloomberg News had
reported that Deutsche was the unnamed bank a Danske whistleblower
said had handled almost $150 billion of suspect transactions
originating in the Danish firm’s Estonian branch.
Deutsche Bank is in the throes of a major restructuring plan,
with 7,000 jobs to go by the end of 2019.
The bank had said at the end of October that it expects to
report a net profit for the first time since 2014, not least
because no legal settlements in the hundreds of millions or even
billions were on the horizon as in previous years.
AFP.
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