Deutsche Bank at heart of criminal EuroDollar crash plan?

[TonyGosling]

Deutsche Bank Has Systemic Money Laundering, Terrorist Financing And Sanctions Problems: UK Regulator
Tyler Durden's picture
Submitted by Tyler Durden on 05/01/2016 20:01 http://www.zerohedge.com/news/2016-05-01/deutsche-bank-has-systemic-mo ney-laundering-terrorist-financing-and-sanctions-proble

Just two days after Deutsche Bank fired the head of its "integrity committee", Georg Thoma who had been originally tasked with clearing up the bank's past scandals, because according to DB's vice chairman Alfred Herling, Thoma had been "overzealous" and "goes too far when he demands ever wider investigations and more and more lawyers come marching up", today the UK financial watchdog agency FCA announced that Germany's biggest bank has "serious" and "systemic" failings in its controls against money laundering, terrorist financing and sanctions, the Financial Times reported.

The Financial Conduct Authority (FCA), has now ordered a separate independent review, the FT reported the letter as saying. The FCA declined to comment.

In other words instad of firing it "Chief Ethics Officer" (sic), Deutsche should have ideally hired a few more because as a result of this latest probe it is most likely looking at billions more in settlement charges over the next 6 - 12 months.

"Our overall conclusion was that Deutsche Bank UK had serious AML (anti-money laundering), terrorist financing and sanctions failings which were systemic in nature," the FCA letter, dated March 2, reportedly said.

"Effective senior management engagement and leadership on financial crime had been lacking for a considerable period of time." And where there is effective senior management, the board makes sure to get rid of said management, because if it actually followed the law how could this megabank ever make money in Europe's monetary twilight zone.

Meanwhile, Deutsche Bank said it is cooperating with regulators to fundamentally reform its anti-financial crime program.

"We understand the importance of this issue and are committed to and engaged in fixing it", a company spokesman said in an emailed statement on Sunday.

This is only the latest brush-up between DB and the FCA: in late 2014, the UK regulator put Deutsche Bank's London office under enhanced supervision owing to concern about the bank's governance and controls. Enhanced supervision procedures are normally kept private and can follow fines. Following its review, Reuters reports, the FCA ordered a so-called skilled persons report - also called a Section 166 report - to assess remedial work Deutsche must now carry out.

Deutsche Bank's new chief executive, John Cryan, who took over in July, has embarked on a deep restructuring of the bank, which includes an overhaul of governance procedures.

Cryan announced in November a review of its know-your-client mechanisms and its vetting procedures when taking on new clients. It has also suspended taking on new customers from 109 countries which it has defined as high risk, compared with 30 countries it had earlier classified as too risky.

The report on the FCA letter comes not only days after the abovementioned acrimonious public squabble among members of Deutsche Bank's supervisory board and the ejection of the man heading the supervisory board’s Integrity Committee, but also just weeks after Deutsche became the first bank to settle and admit to charges that it had manipulated the gold market, and had also agreed to expose other gold manipulation cartel members.

[TonyGosling]

FCA sees issues in Deutsche Bank controls over financial crimes, FT reports
A statue is seen next to the logo of Germany's Deutsche Bank in Frankfurt, Germany, January 26, 2016. REUTERS/Kai Pfaffenbach/File Photo
A statue is seen next to the logo of Germany's Deutsche Bank in Frankfurt, Germany, January 26, 2016.
http://www.reuters.com/article/us-deutsche-bank-fca-idUSKCN0XS1JX

Deutsche Bank (DBKGn.DE) has "serious" and "systemic" failings in its controls against money laundering, terrorist financing and sanctions, according to a confidential letter by the UK's financial regulatory agency, the Financial Times reported.

The watchdog agency, the Financial Conduct Authority (FCA), has now ordered a separate independent review, the FT reported the letter as saying. The FCA declined to comment.

"Our overall conclusion was that Deutsche Bank UK had serious AML (anti-money laundering), terrorist financing and sanctions failings which were systemic in nature," the FT quoted the FCA letter, dated March 2, as saying.

"Effective senior management engagement and leadership on financial crime had been lacking for a considerable period of time."

Deutsche Bank said it is cooperating with regulators to fundamentally reform its anti-financial crime program.

"We understand the importance of this issue and are committed to and engaged in fixing it", a company spokesman said in an emailed statement on Sunday.

In late 2014, the FCA had put Deutsche Bank's London office under enhanced supervision owing to concern about the bank's governance and controls. Enhanced supervision procedures are normally kept private and can follow fines.

Following its review, the FCA ordered a so-called skilled persons report - also called a Section 166 report - to assess remedial work Deutsche must now carry out, the FT reported.

Deutsche Bank's new chief executive, John Cryan, who took over in July, has embarked on a deep restructuring of the bank, which includes an overhaul of governance procedures.

Cryan announced in November a review of its know-your-client mechanisms and its vetting procedures when taking on new clients. It has also suspended taking on new customers from 109 countries which it has defined as high risk, compared with 30 countries it had earlier classified as too risky.

The report on the FCA letter comes days after a public squabble among members of Deutsche Bank's supervisory board and the ejection of the board's member tasked with clearing up past scandals.

Germany's biggest bank, struggling to extract itself from regulatory and legal tangles that have already cost it billions of dollars, announced late on Thursday the resignation Georg Thoma, a top financial lawyer who headed the supervisory board’s Integrity Committee

[TonyGosling]

Deutsche Bank Profit Plunges 98% And The Worst Is Yet To Come
by Tyler Durden
Jul 27, 2016 10:44 AM
http://www.zerohedge.com/news/2016-07-27/deutsche-bank-profit-plunges- 98-and-worst-yet-come

The latest confirmation that Germany's troubled banking giant Deutsche Bank is unable to navigate the troubled waters of NIRP came on Wednesday when the bank announced that its second-quarter net income fell 98% from a year earlier, hurt by weaker performances in trading, investment banking and other core areas. The lender said net income tumbled to €20 million ($22 million) from €818 million a year earlier, modestly better than the €22mm loss expected, while net revenue dropped 20% to €7.4 billion.

After rebounding modestly on the beat, the bank’s shares fell tumbled 5% on Wednesday morning, their lower level in 2 weeks; today's decline has dragged DB stock 45% lower in 2016, making it one of Europe's worst performers YTD (the Stoxx 600 is down 27% in 2016).



As the WSJ notes, the Frankfurt-based bank has been hit harder than most. It is cutting costs and clients and trying to satisfy new, more-stringent capital requirements over the next three years. Its turnaround strategy has eaten into trading and investment-banking revenue, and investors’ concerns about the adequacy of its capital cushion have persisted. The bank also has been trying to settle regulatory investigations expected to result in big fines, another uncertainty for investors.

Chief Executive John Cryan said in a statement that the bank is making progress in a multiyear turnaround, but warned that if weak market conditions persist, it “will need to be yet more ambitious in the timing and intensity of our restructuring.”



Deutsche Bank CEO John Cryan

Investors were unimpressed, and the shares now trade for two thirds less than their tangible book value, a steeper discount than even during the depths of the financial crisis.

What is more troubling is that as Bloomberg adds, the worst is yet to come.

The second quarter gives little cause for celebration. In a quarter which saw revenue sink 12% and net income came in at almost zero, even after litigation costs tumbled, the only division to increase revenues and profit was Postbank, the consumer unit, which Cryan hopes a "white knight" will take off his hands. And unlike rival Commerzbank, Deutsche Bank was able to boost its key capital ratio fractionally in the quarter.The focus on cutbacks meant that Deutsche Bank was unable to benefit from its strength in fixed-income trading in a quarter during which the U.K. vote to leave the European Union stoked market volatility.

While debt trading revenue climbed 22 percent at the top U.S. investment banks in the quarter, Deutsche Bank's fixed-income trading revenue fell 19 percent. In foreign exchange, performance was flat, a sign that restructuring is preventing the bank from getting the most out of the market action.



Low interest rates and economic uncertainty stemming from Brexit weighed on the lender’s biggest businesses last quarter. Revenue fell year-over-year in all four of Deutsche Bank’s business divisions, including asset management. The worst year-over-year revenue decline was in global markets, the bank’s securities-trading operation and its biggest unit by revenue. That division’s second-quarter revenue declined 28% from the year-earlier period. Within the business, overall sales and trading revenue fell 23% during the quarter from a year earlier. Debt trading tumbled 19%, a far cry from the 22% rebound among top US banks.

Another problem for the CEO is that the bank's cost-cutting effort is also lagging compared to US peers: while it is having some positive impact - expenses fell 5% from the year-earlier period - with revenue shrinking, the cost-income ratio remains stubbornly high at 91%.



Another problem: headcount. It stood at 101,307 at the end of June, down by 138 full-time equivalents from the end of March, but still up on the year-earlier period. None of this looks like peak pain.

As Bloomberg adds, Cryan's suggestions on Wednesday that he might have to be "yet more ambitious" in the timing and depth of the restructuring looks like a promise to bolt the stable door long after the horse has bolted. The weak economic environment is unlikely improve soon, especially in Europe, where lower-for-longer interest rates are crushing bank profits. Worse, Deutsche Bank is also seeing rising loan losses from the shipping and metals and mining industries.

None of this bodes well for the execution of Cryan's strategy, and adding to the pressure is that rival banks moving faster with their overhauls: Italy's UniCredit is considering a 5.5 billion-euro capital raising and asset sales.Cryan would be right to ask his predecessors why they didn't move sooner and cut deeper. As it is, he's been left with what he admits will be a "sustained restructuring." Translated, that means peak pain is yet to hit.

Finally, the biggest problem for DB remains its massive balance sheet. Morgan Stanley analysts calculated that Deutsche Bank has a €9 billion capital hole to fill by 2018, and that's not including damage caused by future litigation costs, which considering DB's record of pervasive capital rigging, are sure to rise.

[TonyGosling]

Brilliant graphic
Deutsche Bank refuses to pay $14bn US penalty
By GPD on September 16, 2016
http://www.veteranstoday.com/2016/09/16/deutsche-bank-refuses-to-pay-1 4bn-us-penalty/
Germany’s biggest bank says it won't pay a $14 billion US Department of Justice (DoJ) fine for selling mortgage-backed securities that contributed to the 2008 financial crisis.
“Deutsche Bank has no intent to settle these potential civil claims anywhere near the number cited. The negotiations are only just beginning. The bank expects that they will lead to an outcome similar to those of peer banks which have settled at materially lower amounts,”Deutsche Bank said in a statement on Friday.
The Wall Street Journal reported the DoJ is demanding $14 billion in compensation to settle a set of high-profile mortgage-securities probes stemming from the financial crisis.
The bank’s spokesman confirmed in July settlement negotiations were underway, but the size of the potential penalty was unknown before today.
The amount is almost equal to Deutsche’s market cap. As a result, the share price of the German bank plummeted over eight percent on Friday, dragging the country’s stock market half a percent lower. Friday’s slump added to the 45 percent drop in the bank’s stock since January and a 53 percent slump over the last twelve months.



‘Europe is extremely sick’, says Deutsche Bank chief economist
https://www.rt.com/business/350622-european-banks-crisis-deutsche-bank  /

Bank of America paid $17 billion to settle a similar probe in 2014. Goldman Sachs agreed to reimburse $5.1 billion earlier this year over troubles with mortgage-backed securities that were sold to investors as high-quality debt.

In 2014, the DoJ demanded Citigroup pay $12 billion for selling low-grade mortgage-backed securities, but the fine was cut to $7 billion.

Barclays, Credit Suisse Group, UBS and Royal Bank of Scotland face similar investigations and could also be penalized by US authorities.

[TonyGosling]

Tomorrow is going to be extremely interesting!

The House of Saud is dumping the petrodollar, US federal govt faces shutdown at midnight due to unpaid debt, UN is taking over the internet worldwide, and the Deutsche bank derivative beast is about to come undone:

http://www.zerohedge.com/news/2016-09-29/run-begins-deutsche-bank-hedg e-fund-clients-cut-collateral-exposure

[TonyGosling]

Deutsche Bank’s potential $14bn penalty in 10 simple charts
Germany’s biggest bank faces a potential penalty over mis-selling. These charts show what it means for the bank and the economy
Deutsche Bank’s assets are valued at €1.6tn ($1.8tn).
Sean Clarke, Pamela Duncan and Cath Levett
Wednesday 12 October 2016 12.21 BST Last modified on Wednesday 12 October 2016 16.07 BST
https://www.theguardian.com/business/2016/oct/12/deutsche-bank-potenti al-penalty-10-simple-charts

How big is the penalty?
The US Department of Justice has started the negotiations at $14bn. That would make it one of the biggest settlements for mis-selling mortgage bonds, a scandal that erupted in the wake of the banking crisis when it emerged that banks had packaged up mortgages and sold them on to investors as residential mortgage backed securities.

It is the same, almost, as Deutsche Bank’s value on the stock market of about €16bn ($17.8bn).


How big, and how healthy, is Deutsche Bank?
The bank’s assets are valued at €1.6tn ($1.8tn), or half a year’s output for the entire German economy. But weight those assets for risk, and the number is €397bn ($441bn). Germany has lots of banks, with more branches per person than comparable economies; on the high street, Deutsche Bank is one among many.


When the European Banking Authority simulated a financial crisis based on banks’ balance sheets in June, the second worst performer was Deutsche Bank. Only Italy’s extremely troubled Monte dei Paschi di Siena came off worse.

Deutsche would point to its stock of easy to sell assets – its liquidity buffer – which stands at €215bn ($239bn) as a sign of its financial strength.

Investors fear that if the settlement with the justice department is as large as first suggested, it put the measures used by regulators to gauge its financial health under pressure. The bank’s share price has halved in the last 12 months, and its stock market value is 25% of its the assets on its balance sheet.


Potential investors may also be put off by Deutsche Bank’s unusually large engagement with over-the-counter derivatives – complicated financial products such as futures contracts which banks sell to one another off the open market.


What are the implications for the rest of the banking system?
The International Monetary Fund said in June that Deutsche Bank was responsible for about 30% of the risk in the global financial system, and concluded it presented the biggest risk to the financial system, in part because of its connections to other major banks.


What can Deutsche Bank sell?
The bank has several subsidiaries (among many hundreds) which it could put up for sale. Abbey Life in the UK has already been sold, and the bank is also planning to dispose of its minority stake in Huaxia, a Chinese bank. But some of its other potential selloffs are more problematic; its profitable asset management division is an attractive asset, but losing it would dent the bank’s already soggy bottom line. Its German retail subsidiary Postbank is theoretically worth over €6bn, but proving tricky to sell off.


There has been talk that Deutsche could be put together with its domestic rival Commerzbank. One of the reasons for the trough in its share price is the expectation that it will sell more shares to investors. This will bolster its crucial regulatory capital ratios but putting more shares in circulation means their value is likely to go down.

[Whitehall_Bin_Men]

Deutsche to pay $425 million to New York regulator over Russian 'mirror trades'
A statue is pictured next to the logo of Germany's Deutsche Bank in Frankfurt, Germany September 30, 2016.
http://www.reuters.com/article/idUSKBN15E2SP

By Karen Freifeld and Arno Schuetze | NEW YORK/FRANKFURT
Deutsche Bank AG (DBKGn.DE) has agreed to pay $425 million to New York's banking regulator over a "mirror trading" scheme that moved $10 billion out of Russia between 2011 and 2015, the regulator said on Monday.

In addition, Britain's Financial Conduct Authority is about to penalize the bank roughly $200 million for the suspicious trades, a person familiar with the matter said.

The scheme involved clients buying stocks in Moscow in rubles and related parties selling the same stocks shortly thereafter through the bank's London branch, the New York Department of Financial Services (DFS) said in a statement.

The trade of a Russian blue chip stock, typically valued at between $2 million to $3 million an order, was cleared through the bank's New York operations, with the sellers typically paid in U.S. dollars, DFS said.

The regulator, which licenses and supervises the New York branch, found the bank conducted its business in an unsafe and unsound manner in violation of state banking law.

Though the trades appeared to have no legitimate economic purpose, Deutsche's deficient anti-money laundering controls and know-your-customer policies did not detect and stop the scheme for years, DFS superintendent Maria Vullo said.

Deutsche Bank said "it has been unable to identify the actual purpose behind this scheme," according to a consent order between the New York regulator and the bank. "It is obvious, though, that the scheme could have facilitated capital flight, tax evasion or other potentially illegal objectives."

In addition to the penalty, Deutsche is required to retain an independent monitor to review the bank's compliance programs.

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Deutsche Bank said in a statement that the settlement monies were already reflected in existing litigation reserves. It said the regulator considered its cooperation and remediation in reaching the penalty.

Deutsche also said it was cooperating with other regulators and law enforcement authorities with their ongoing investigations of the trades.

A spokesperson for the Financial Conduct Authority declined to comment. The source on the FCA's expected penalty did not want to be identified because the terms were not public.

[Whitehall_Bin_Men]

Who closed the investigation against Deutsche Bank for money laundering
Mark Taylor made this Freedom of Information request to Serious Fraud Office
https://www.whatdotheyknow.com/request/who_closed_the_investigation_ag a

Currently waiting for a response from Serious Fraud Office, they must respond promptly and normally no later than 30 June 2017 (details).

Mark Taylor 3 June 2017
Dear Serious Fraud Office,
It now appears Deutsche Bank are part of a money laundering cartel, the cartel having illegally moved some £65 billion from Russian to London, and includes HSBC, RBS, UBS and Barclays.
As you know, in request 9559 from Jon Thompson of HMRC the SFO were informed Deutsche Bank had most certainly destroyed OTC bullion receipts, and this constitutes an Anti-Money-Laundering control violation. The destruction of receipts would be to cover up liabilities for gold and silver rigging, for which it recently settled, incriminated co-defendants, and for which traders have pleaded guilty in Chicago, USA.
The SFO and the FCA were furnished with proof that Deutsche Bank's bullion audits were fallacious back in 2014. http://www.shyreman.com/docs/MPs/fca.tre... and did not report the frauds to Parliament.
The SFO refused the application 9559. I would like to know who at the SFO is most responsible for that decision. I believe it would be the Attorney General Jeremy Wright, who was informed of the decision multiple times without comment. Bob Neil, chairman of the Justice Select Committee explicitly refused to scrutinize the SFO's conduct in these matters.

To re-iterate: who at the SFO is most responsible for refusing request 9559 to investigate Deutsche Bank for fraudulently destroying its OTC bullion receipts.

Yours faithfully,

Mark Taylor

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[Whitehall_Bin_Men]

TOO BIG TO FAIL?
Deutsche Bank Money Laundering Scandal Could Create Greatest Economic Crisis in History
The leak of the FinCEN Files over the weekend has rocked global markets and augurs a financial crisis of epic proportions as Deutsche Bank hovers over the precipice.
https://www.mintpressnews.com/fincen-deutsche-bank-money-laundering-sc andal-economic-crisis/271395/

by Raul Diego September 21st, 2020 By Raul Diego
Deutsche Bank, along with several of the world’s biggest commercial banks, are embroiled in a global money laundering scandal that spans over two decades, as documents leaked to BuzzFeed show the movement of $2 Trillion in illicit cash through the Western banking establishment.

The cache of Suspicious Activity Reports (SARs) detailing years of potentially illegal banking transactions were shared with 108 news organizations in 88 countries, according to the International Consortium of Investigative Journalists (ICIJ). These records are a requirement for any financial institution that engages in dollar-denominated transactions anywhere in the world and are filed with the Treasury Department’s intelligence unit, the Financial Crimes and Enforcement Network or FinCEN.

The more than 2,100 SARs released to the press are considered “historical” documents by the implicated banks, who responded with their usual Pontius Pilate routine when reached for comment by the media and washed their hands of the matter by claiming to have fulfilled their legal obligation before the U.S. Treasury “as part of our partnership with regulators and law enforcement to protect the global financial system,” as a Deutsche Bank statement puts it.


The Trump-linked German bank is, by far, the most beset by the suspicious activity records totaling well over half of the $2 Trillion-dollar sum the FinCEN Files trace, with approximately $1.3 Trillion of it moving through the scandal-plagued financial institution. Most of the press coverage in the U.S., so far, has focused on the ties to Russian oligarchs and assorted narratives that are hovering over election-year American political discourse. Deutsche Bank’s central role, nevertheless, betrays a far greater problem as the bank’s potential collapse could send the financial world into a tailspin and result in the greatest economic crisis in history.



1MDB
As European bank stocks tumble amid the revelations, FinCEN condemned the unlawful disclosure of the SARs to the press and warned that it could “impact the national security of the United States.” Meanwhile, the U.S. Justice Department is in the middle of the largest asset-recovery effort in U.S. history, filing its latest complaint regarding $300 Million the department is attempting to recover for an $11.7 Billion Malaysian sovereign wealth fund called 1MDB, one of the major cases highlighted by ICIJ in its report on the leaked SARs.

Absent from most coverage of the FinCEN leaks, however, is how all of these banks and financial institutions are not only laundering trillions, but are doing so together and in consort with each other, as is plainly demonstrated in the 1MDB fraud case. Most publications point the finger at JP Morgan Chase as the entity that moved more than $1 Billion for Jho Low, one of the 1MDB’s central figures, but they fail to mention the role of Goldman Sachs, which orchestrated a significant part of the scheme that defrauded the Malaysian people and led to criminal charges against 17 of its current and former executives, including Goldman Sachs former vice-chairman and now president of Chinese mega eCommerce platform Alibaba, Michael Evans.


The Malaysian government recently agreed to drop charges against Goldman Sachs after a $2.5 Billion-dollar settlement was reached with the giant investment bank; nearly a fourth of the $10.5 billion-dollar debt hole it created for Malaysia’s ruling coalition, resulting in the cancelation of major infrastructure projects. Deutsche Bank was also involved in the multi-pronged attack of the Western financial vultures on the Malay through the provision of hundreds of millions in stock-buy-back loans through the 1MDB fund for the former prime minister, who was convicted in July of graft.



A Hit Job?
The ostensible purpose of the 1MDB fund was to finance infrastructure projects, like the oil and gas pipeline projects shelved as a result. But, according to a report by Business Insider, the money “veered into lavish spending,” such as art purchases, and, quite fittingly, to the production of the “The Wolf of Wall Street” – a story about the unmitigated fraud and graft that the very same people and institutions ensnared in this scandal carry out day in and day out.

It is reported that former Goldman Sachs CEO, Lloyd Blankfein, met with the disgraced Malaysian PM and the fugitive businessman, Jho Low, before the fund’s debut in 2009. Another lawsuit brought against Goldman Sachs details the investment bank’s “central role in a long-running effort to corrupt former executives” of An Abu Dhabi wealth fund called International Petroleum Investment Corporation and its subsidiary, Aabar Investments, which partnered with the 1MDB, calling it “a massive, international conspiracy to embezzle billions of dollars.”

Few can argue with that characterization, but as the chickens come home to roost, it is important to keep an eye on who gets exposed and who doesn’t; who gets punished and who doesn’t. The FinCEN Files are meant to draw most of the attention to Deutsche Bank and has all the hallmarks of a premeditated hit on one of the lynchpins of the prevailing financial structure. Much like Lehman Brothers and Bear Sterns were sacrificed for the subprime mortgage crisis and opened the door for even greater consolidation among the “too-big-to-fail” banks, a calculated take-down of Deutsch Bank will, no doubt, allow for a similar consolidation to occur at a far larger scale.

Feature photo | The towers of the Deutsche Bank in Frankfurt, Germany. Michael Probst | AP

Raul Diego is a MintPress News Staff Writer, independent photojournalist, researcher, writer and documentary filmmaker.

Republish our stories! MintPress News is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 International License.
1MDB DEUTSCHE BANK FINCEN GOLDMAN SACHS



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