More vigorous action needed on money laundering, BaFin tells Deutsche Bank

German financial regulator BaFin has told banking giant Deutsche Bank it needs to introduce stronger action on money laundering.

According to CNBC, BaFin has ordered Deutsche Bank to enact further safeguards to prevent money laundering.

The bank was fined nearly $700m for allowing money laundering back in 2017 following a plan of artificial trades between London, New York and Moscow which authorities claimed were used to launder $10bn out of Russia.

BaFin previously had to install KMPG as a special monitor of Deutsche in 2018 to oversee development on money-laundering controls. Following this recent development, BaFin has expanded KPMG’s powers further.

In a brief statement, BaFin said it aimed to improve controls particularly regarding ‘regular customer reviews’ which applied to the monitoring of transactions as well as correspondent banking.

Deutsche Bank commented that while it was improving its controls, it was well aware work still needs to be done.

“The order is the result of a constructive supervisory dialogue with the BaFin and reflects that the bank continues to attach the highest priority to detecting and remedying possible weaknesses in control processes. We are working intensively to also comply with the new requirements within the given timeframe.”

Last year, Deutsche received sanctions from New York regulators after it processed billions of euros of payments for Danske Bank, who had an Estonian branch that was in the middle of a money-laundering scandal.

The Singapore branch of the Swiss wealth manager Bank J Safra Sarasin was recently fined $750,000 by the Monetary Authority of Singapore for serious breaches of anti-money laundering and countering the financing of terrorism requirements.

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