Frankfurt prosecutor’s office closes Regula-linked investigations into Deutsche Bank employees

Maria Nikolova

The proceedings were linked to German client interactions with offshore entities which were established by Deutsche Bank’s subsidiary Regula Ltd.

Deutsche Bank AG (ETR:DBK) today announces the closing of investigations into two of its employees in the “Regula” proceedings. The Frankfurt public prosecutor’s office is reported to have closed investigations due to lack of sufficient suspicion in accordance with paragraph 170 (2) of the German Code of Criminal Procedure.

This move means that the allegations of aiding and abetting tax evasion and of money laundering that were made against the suspected bank employees and the bank have been dropped.

The proceedings were linked to German client interactions with offshore entities which were established by Deutsche Bank’s subsidiary Regula Ltd, which was sold in March 2018.

Deutsche Bank explains that, in a separate proceeding, it accepts a fine of 5 million euros as well as the confiscation of avoided expenses in the amount of 10 million euros, payable as a result of shortcomings in its control environment.

Joerg Eigendorf, group spokesman of Deutsche Bank, commented:

“It is true that the bank had weaknesses in its control environment in the past. We identified these weaknesses and we have addressed them in a disciplined manner.”

Deutsche Bank has increased the number of employees in its Anti-Financial Crime unit threefold. The Bank has invested 700 million euros since 2016 in modernising its key controls.

It was in connection with this investigation that – together with Federal Criminal Police officers – the Frankfurt public prosecutor’s office raided Deutsche Bank’s headquarters in Frankfurt and other business premises in and around Frankfurt on November 29, 2018. Back then, the bank commented:

“We confirm that the police are currently conducting an investigation at a number of our offices in Germany. The investigation relates to the Panama Papers. We are cooperating fully with the authorities.”

Today, Deutsche Bank said that the public prosecutor’s office stated that it is still in talks with Deutsche Bank in connection with the investigation into Danske Bank and that these talks are constructive.

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