As a requirement of jurisdictional law, obliged firms such as banks and other financial institutions (firms) are required to file suspicious activity reports (SARs) with their local financial intelligence unit/law enforcement agency when they have knowledge, suspicion (and/or in some countries reasonable grounds) to suspect that their products and services are being used to further financial crime/money laundering or facilitate the financing of terrorism. However, a SAR being filed on a customer does not automatically mean a client is guilty of wrongdoing or necessarily require a bank to cease doing business with the client (this decision would ordinarily fall within the bank’s remit under their policy and risk procedures.
Deutsche Bank AG has recently paid a settlement of €7 million following a money laundering investigation by German prosecutors. The investigation looked into whether Deutsche had laundered money for relatives of Syrian dictator Bashar al-Assad. Officers from the financial regulator BaFin, the federal police, and the Frankfurt public prosecutor’s office launched a raid in April 2022 after securing a search warrant from the local court. Deutsche Bank is not a newcomer when it comes to lapses in meeting regulatory requirements, as it fell again under scrutiny in 2017 for failing to spot fraudulent trades worth up to $10 billion that allowed money to be laundered out of Russia, resulting in a £501 million fine.
Since then, it has been subject to a two-day raid in 2018 which resulted in fines over shortcomings in the bank’s compliance procedures as well as a £11.3 million fine by Frankfurt prosecutors in 2020 for failing to submit a suspicious report over transactions processed on behalf of Danske Bank’s Estonian branch in a timely manner.
This settlement has come almost a year after Deutsche Bank had announced a series of measures that were meant to reform its compliance function and risk management measures. The changes meant to allow the bank to improve its functions to meet the level set by regulatory requirements. Significant progress needs to be matched with significant effort and time to adopt a culture of compliance.
Anti-Financial Crime Support – How can Complyport Help?
Our experienced Financial Crime and Forensics team led by Martin Schofield—one of the world’s leading specialists in the field—brings a wealth of experience to every project we are engaged in. Our highly experienced financial crime professionals and forensic experts, in subjects such as anti-money laundering, counter terrorist financing, anti-bribery and corruption and fraud and regularly help our clients navigate the complexities of the financial crime and money laundering environment. Services offered by Complyport include:
- AML/Fraud policy & training reviews,
- Transaction monitoring / reporting framework reviews,
- Vulnerable Customer Management framework reviews/audits/gap analysis,
- Financial crime health checks and audits,
- Implementation of financial crime, AML, CTF, ABC, Fraud and market abuse controls and frameworks,
- Ongoing advice on financial crime, AML, CTF, market abuse and fraud prevention,
- Authoring/reviewing financial crime policies,
- Outsourced MLRO support
- Outsourced KYC and CDD support,
- Assistance in identifying Politically Exposed Persons (PEPs),
- Assistance in navigating international sanctions,
- Support with preventing market abuse and insider dealing,
- Expert Witness in Financial Crime cases
- Forensics and Investigations
- Design and/or delivery of online or face to face financial crime training
If this article has raised any questions, or you think your firm may require assistance, please contact either Martin Schofield via martin.schofield@complyport.co.uk or Jan Hagen via jan.hagen@complyport.co.uk to book in a free consultation.
About Complyport
Complyport is the City’s market leading consulting firm supporting the UK financial services industry for over 20 years. We specialise in providing Governance, Risk and Compliance services to support the regulated financial services industry to raise standards and thrive.
Complyport advises and assists firms to become authorised and to comply with the rules and requirements of regulators on an ongoing basis. Our vision is to be there for our clients every step of the way, helping them change, grow, and excel through expertise, insight, and innovation, and in so doing to become our clients’ most valued supplier and trusted advisor.
With presence in the UK and EU, as well as via our Associates Network, Complyport can assist firms across multiple jurisdictions.
Complyport’s multidisciplinary consultants possess deep expertise in their field, having acted in FCA skilled person reviews, as expert witnesses in legal cases and as expert investigators for firms or their legal advisers.
Day to day, we conduct audits and reviews of a firm’s products, processes, policies, and procedures to identify scope for business, to determine the impact of regulatory developments and to verify compliance with local regulations. Complyport can also assist firms by providing personnel to cover all the key compliance functions including resourcing individuals to be registered as your Compliance Oversight Function (SMF16) and/or Money-Laundering Reporting Officer (SMF17).
Our clients tell us we live our values; we are driven, agile and collaborative.
