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31.01.2017 03:49 Age: 2 days

Bank fined 163m for money laundering failings


The Financial Conduct Authority has fined Deutsche Bank AG more than 160 million for failing to maintain an adequate anti-money laundering framework.

The fine, which totals 163,076,224, is the largest financial penalty imposed for AML offences, the FCA said.

According to the FCA, the bank, which failed to control its AML framework between January 2012 and December 2015, was used by unidentified customers to transfer around $10 billion from Russia to offshore bank accounts in a manner that was 'highly suggestive' of financial crime.

Mark Steward, director of enforcement and market oversight at the FCA, said: 'Financial crime is a risk to the UK financial system. The size of the fine reflects the seriousness of Deutsche Bank's failings. Other firms should take notice of today's fine and look again at their own AML procedures to ensure they do not face similar action.'

The FCA also found that Deutsche Bank:

  • Performed inadequate customer due diligence;
  • Used flawed customer and country risk rating methodologies;
  • Lacked automated AML systems for detecting suspicious trades and
  • Failed to provide adequate oversight of trades booked in the UK by traders in non-UK jurisdictions.

The AML failings also allowed the front office of Deutsche Bank's Russia-based subsidiary to execute more than 2,400 pairs of trades that mirrored each other between April 2012 and October 2014.

The mirror trades were used by customers of Deutsche Bank and DB Moscow to transfer more than $6bn from Russia, through Deutsche Bank in the UK, to overseas bank accounts.

Deutsche Bank agreed to settle at an early stage of the FCA's investigation and qualified for a 30% discount.

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Bank fined 163m for money laundering failings