Telephone 020 3813 2890 for a free no obligation chat about your regulatory requirements with one of our compliance consultants.

© Compound Growth Limited 2012 - 2018 | Terms of Use

Registered in England and Wales as limited company number 07626537 - Registered Office 120 Pall Mall, London, SW1Y 5EA

We use cookies, if you consent to this use, please continue to browse our site.

Here to help with Regulation and Compliance

Compound Growth

Deutsche Bank Fined £163 Million for Serious AML Control Failings

7th February 2017

Deutsche Bank receive record AML Fine

Last week the FCA fined Deutsche Bank AG £163,076,224 for failing to maintain adequate anti-money laundering (AML) controls during January 2012 to December 2015. 

This is the biggest fine the FCA (or its predecessor the FSA) has ever imposed for AML control failings.

The biggest failings were that Deutsche Bank failed to properly oversee the formation of new customer relationships and the booking of global business in the UK. 

As a result of Deutsche Bank’s inadequate AML controls, the Bank was used by “unidentified customers to transfer approximately $10 billion, of unknown origin, from Russia to offshore bank accounts in a manner that is highly suggestive of financial crime”. 

Amongst the significant AML control deficiencies found by the FCA at Deutsche Bank were that they:

• had deficient AML policies and procedures
• had an inadequate AML IT infrastructure
• performed inadequate customer due diligence
• failed to ensure that its front office took responsibility for the CB&S division’s Know Your Customer obligations
• used flawed customer and country risk rating methodologies
• lacked automated AML systems for detecting suspicious trades
• failed to provide adequate oversight of trades booked in the UK by traders in non-UK jurisdictions

Consequently, Deutsche Bank failed in being able to obtain sufficient information about its customers to adequately perform a risk assessment and provide a basis for transaction monitoring. 

The Director of Enforcement and Market Oversight at the FCA, Mark Steward, said:

“The size of the fine reflects the seriousness of Deutsche Bank’s failings.  We have repeatedly told firms how to comply with our AML requirements and the failings of Deutsche Bank are simply unacceptable. 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 regulator is continually emphasizing the importance of having a robust AML control framework and firms are frequently reminded of how to comply with AML requirements  and of the importance of safeguarding the UK financial system from financial crime.

Had Deutsche Bank not agreed to settle at an early stage of the FCA’s investigation the financial penalty would have been £229,076,224.

Compliance & Client Due Diligence Support

If you would like assistance in reviewing your current client due diligence processes or client-on-boarding procedures or if you would like to arrange tailored AML training for your firm, please contact our experienced team of compliance specialists who would be happy to help.

We can assist with:

• Client Due Diligence (CDD)
• Client On-boarding Procedures
• MLRO’s Annual Money Laundering Risk Assessment
• Tailored and Refresher Training:

- AML & Prevention of Financial Crime,

- Role of the MLRO

Related Articles & Reading:

• FCA Final Notice: Deutsche Bank 31Jan2017
• HM Treasury Money Laundering & Counter Terrorist Financing Controls
• Financial Crime Guidance
• Financial Crime Systems & Controls
• Money Laundering & Terrorist Financing

Read our latest articles, news and views affecting compliance and regulation in the UK Financial Services Industry.