Deutsche Bank pays USD 130 million to resolve charges of bribery and fraud
On 8 January 2021, the multinational bank Deutsche Bank AG (hereinafter “Deutsche Bank”) has reached a settlement with the U.S. Department of Justice (hereinafter “DOJ), the U.S. Securities Exchange Commission (hereinafter “SEC”) and the U.S. Commodity Futures Trading Commission (hereinafter “CFTC): Deutsche Bank agreed to pay more than USD 130 million in order to resolve the investigation into violations of the U.S Foreign Corrupt Practices Act (hereinafter “FCPA”) and a separate investigation into a commodities fraud scheme.
In its resolution with the DOJ and the SEC, Deutsche Bank has resolved charges of conspiracy and substantive violations of the books and records provisions and internal control provisions of the FCPA. Pursuant to the DOJ, between 2009 and 2016 executives of Deutsche Bank utilised business development consultants as proxies in order to channel bribes to foreign government officials to secure business. To disguise the bribery schemes, the executives conspired to conceal these corrupt payments and bribes by falsely recording them on Deutsche Bank’s books and records, as well as related internal accounting control violations. According to the DOJ’s press release, these actions concerned officials in China, Italy, Russia, Saudi Arabia and the UAE.
Furthermore, between 2008 and 2013, several precious metals traders of Deutsche Bank engaged in a scheme to defraud other traders, according to the DOJ’s press release: Thus, traders on several Deutsche Bank’s precious metals desks placed on numerous occasions, orders to buy and sell precious metals futures contracts with the intent to cancel those orders before execution; including in an attempt to profit by deceiving other market participants through injecting false and misleading information concerning the existence of genuine supply and demand for precious metals futures contracts.
The resolution includes criminal penalties of USD 85’186’206, criminal disgorgement of USD 681’480, victim compensation payments of USD 1’223’738 and USD 43’329’622 to be paid to the SEC in a coordinated resolution. A 25% discount was applied to the criminal penalty to account for the 2015 resolution of the company’s prior misconduct in manipulating the London Interbank Offered Rate.