Deutsche Bank fined $15.9M for lag in reporting suspicious transactions

The Frankfurt Prosecutor’s Office announcement was connected to the Danske Bank money laundering scandal that saw €200 billion in tainted money flow through Danske’s Estonian subsidiary. German investigators were apparently interested to learn how much of that money was flowing through Deutsche Bank and whether Deutsche alerted authorities soon enough about the suspicious transactions.

Deutsche had been acting as a correspondent bank for Danske Bank Estonia, and its role in processing the dirty money was uncovered by a whistleblower in 2018, according to a story in The Financial Times. The German bank processed about four-fifths of the suspicious transactions from 2007 to 2015, the story said. Deutsche said the transactions began in 2010.

In a statement Deutsche Bank said it terminated its relationship with Danske Bank Estonia in 2015 and that it “fully cooperated” with the German investigation.

“With the closure of these proceedings it is clear that there was no evidence of criminal misconduct either on the part of Deutsche Bank or its employees,” said Stefan Simon, member of the management board of Deutsche Bank.

“As part of this investigation, no allegations were made against the bank in terms of it having breached its supervision obligations or organisational duties or certain persons violating their responsibility, nor were any breaches ascertained,” Deutsche said.

Deutsche Bank was hit with a $150 million fine in July from the New York State Department of Financial Services that was, in part, related to its role as a correspondent banker for the Danske Bank Estonia transactions.