- The
Federal Reserve recently reprimanded $4 over its money-laundering controls, $4 reported Thursday. - The
bank is in the middle of a major overhaul and working to regain trust among investors and regulators after numerous investigations for weak money-laundering protections. - The
Fed also scoldedDeutsche Bank for not rectifying issues that led to its "troubled condition" rating from the central bank in 2017, according to The Journal. - Company CEO Christian Sewing recently noted there is work to be done in meeting regulatory standards, saying in $4, "Are we there yet regarding our controls? The answer is no."
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The Federal Reserve recently lambasted $4 for loose controls as the firm looks to overhaul its reputation, $4 reported Thursday, citing a person familiar with the matter.
The central bank notified Deutsche Bank in a letter that it had ongoing concerns about the firm's US money-laundering protections, according to the report. The Fed also criticized the company for not resolving issues that led to its "troubled condition" classification in 2017.
The bank has worked to improve its standing with regulatory bodies after receiving the unusually negative Fed rating. Deutsche Bank is in the middle of a major restructuring that began in 2019. While it passed a Fed stress test last year for the first time, CEO Christian Sewing recently noted there is work to be done in regaining trust among authorities and investors.
"We have also continued to improve our internal controls and processes," Sewing said in a $4 set to be delivered later in May. "Are we there yet regarding our controls? The answer is no."
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The Fed's letter is far from the first time Deutsche Bank's money-laundering protections have fallen under scrutiny. US regulators are looking into the firm's part in a laundering scandal. Deutsche Bank served as a correspondent bank to Danske Bank in Estonia but ended the partnership in 2015 after learning of suspicious activity among Danske's clients. Following investigations found roughly $230 billion in questionable funds were transferred through the Danske branch over several years.
Authorities are also probing Deutsche Bank's money-laundering controls and whether they've been abused by Russian oligarchs. The Fed fined the firm $41 million in 2017 for not meeting regulatory standards, according to The Journal.
The company paid a $629 million settlement just months earlier to end investigations into illegal Russian stock trades. The activity moved more than $10 billion out of the country and violated anti-laundering laws, according to The Journal.
Deutsche Bank traded at $6.62 as of 11:10 a.m. ET Thursday, down 15% year-to-date.
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