German supervisor raps Deutsche Bank over money laundering

Berlin:

Germany’s financial supervisor urged Deutsche Bank Monday to beef up its fight against money laundering, and for the first time used its power to embed an auditor at the country’s biggest lender.

Frankfurt-based BaFin “ordered DeutscheBank to take internal security measures and respect its general duty of care for the prevention of money laundering and terrorist financing,” the agency said in a statement.

In a never-before-seen move, BaFin will also embed a “special commissioner” at Deutsche to evaluate and report on the bank’s progress, it added.

“We are in agreement with the BaFin that we have to improve these processes in the Corporate and Investment Bank further,” a Deutsche Bank spokesman told AFP.

He added that the bank would work to meet its obligations with the authorities and auditors KPMG, who BaFin chose as commissioners.

In January 2017, Deutsche had to pay a fine of almost $630 million (535 million euros) after an investigation by British and American authorities into laundering of money originating in Russia.

Soon afterwards, the US Federal Reserveordered a further fine of $41 million over gaps in the bank’s money-laundering surveillance.

American lawmakers also demanded information about Deutsche’s relationship with President Donald Trump and any financial links he might have with Russian entities.

Laundering of Russian cash has returned to the headlines in recent weeks, with Denmark’s biggest lender Danske Bankadmitting that tens of billions of euros of suspicious transactions passed through its branch in Estonia, most of them from Russia.

In neighbouring Latvia, the central bankchief has also been suspended from his post after being charged with accepting bribes.

Malta, Estonia, Latvia and Cyprus are among the countries with the worst money-laundering image in the 19-nation eurozone, although Spain’s Caixabank and Netherlands-based ING have also come in for extra scrutiny by the authorities.

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