Federal Reserve Fines Deutsch Bank $186M for Violating Orders on Sanctions Compliance
The Federal Reserve Board on July 19 fined Deutsche Bank, its New York branch and other U.S. affiliates $186 million for violating two consent orders with the bank dealing with sanctions compliance and anti-money laundering controls. The board said Deutsche Bank "made insufficient remedial progress" under the two orders and had insufficient "anti-money laundering internal controls and governance processes" stemming from its past relationship with the bank's Estonian branch.
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The board said that since 2012, Federal Reserve Bank of New York supervisors have identified "various deficiencies in governance, risk management, and internal controls" across the bank's U.S. operations. The bank was ordered to submit seven plans to improve its internal controls, including a written plan to boost its oversight, effectiveness and comprehension of its remediation office within 60 days so that "root causes of issues are addressed in a holistic and timely manner." This plan must include measures "to ensure the oversight, stature, and breadth of expertise of" the remediation office, improve communication of issues to senior management and more. Failure to fix its issues could result in a "cease-and-desist order, monetary penalties or additional affirmative corrective actions," the board said.