In a two-day raid, the Frankfurt public prosecutor’s office and the Federal Criminal Police Office searched several Deutsche Bank offices, including its head office at Taunusanlage in Frankfurt, and questioned employees. The investigations concern the so-called “offshore leaks” and Panama Papers.
The public prosecutors’ investigations are directed against “two named and further unnamed employees of the bank on suspicion of aiding and abetting money laundering,” Deutsche Bank stated. “According to the public prosecutor’s office, the accusation against the accused is that they did not report money laundering in time, but only after the publication of the so-called Panama Papers in the media,” Deutsche Bank reported. The preliminary proceedings concern the period from 2013 to 2018.
The search included several board member offices, but no formal interrogations of board members, Deutsche Bank said. It added that no current and former board members of Deutsche Bank AG are among the accused employees.
According to the public prosecutor’s office, the evaluation of the papers by the Federal Criminal Police Office is said to have revealed that a company in the group headquartered on the British Virgin Islands had provided customers with a structure that made money laundering possible. This company was sold in March 2018.
Deutsche Bank said the investigations are not related to Danske Bank Estonia.
In an earlier statement, Deutsche Bank said, “As far as we are concerned, we have already provided the authorities with all the relevant information regarding Panama Papers. Of course, we will cooperate closely with the public prosecutor’s office in Frankfurt, as it is in our interest as well to clarify the facts. In recent years, we have proven that we fully cooperate with the authorities—and we will continue to do so.”
For other financial institutions, the lesson from Deutsche Bank is how important it is to gain the trust of the regulators when you are cooperating.
“Executing on a search warrant is not a simple process; the government must plan the logistics of the search, document the rationale behind the search, obtain approval, and invest significant resources and personnel in carrying out the search,” says Julie Myers Wood, CEO of Guidepost Solutions, a global investigations and security consulting firm. “Given this level of effort, search warrants are normally used in situations where the government is concerned about cooperation and believes that simply requesting or subpoenaing the documents and information would be ineffective.”
“In this situation, Deutsche Bank reported that it believed it had provided all relevant documents to the government—but the search warrants suggest the government had a reason to believe that additional relevant documents existed,” Wood adds.
“Often, it is not enough for a company to simply provide documents to regulators without having discussions with the regulators—both to ensure that the extent of the company’s cooperation is fully understood, and to help the company confirm it has provided all responsive information,” she says.
“Building a strong relationship with the authorities can help reduce the likelihood of search warrants and other aggressive government tactics.”
via Compliance Week