Deutsche Bank offices raided by police in tax haven case

Dwayne Harmon
November 30, 2018

Police in Frankfurt raided six offices of the country's largest moneylender, Deutsche Bank, on Thursday, following allegations of facilitating and failing to report money laundering.

It is believed the probe involves the so-called Panama Papers, leaked documents pertaining to over 200,000 offshore dealings.

The Papers revealed the financial secrets of the world's financial and criminal elite, detailing years of tax avoidance and money laundering in the hundreds of millions - including millions of pounds from the Queen's private estate.

Investigators are probing the activities of two Deutsche Bank staff members who are alleged to have helped clients set up off-shore firms to launder money, the prosecutor's office said.

The bank tweeted: "It is true that the police is now conducting an investigation at a number of our offices in Germany".

"The investigation has to do with the Panama Papers case", the bank said.

"... Most importantly, the lack of transparency and regulatory control have made cryptocurrencies a target for criminal purposes and we know that they on several occasions have been involved in criminal transactions like money laundering or extortion", it reads. The officials said the raid wasn't related to its role as a correspondent bank for money laundering at Denmark's Danske Bank.

Shares in Deutsche Bank were down 3.4 percent at 8.30 euros in the early afternoon, making them the worst performing stock on the DAX blue-chip index.

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It is separate from another money laundering scandal surrounding Danske Bank, where Deutsche Bank is involved.

USA and British regulators fined the bank $630 million past year for allowing wealthy Russians to launder $10 billion in cash between 2012 and 2015. Regulators fined it $630 million in 2017 over an illegal scheme with Russian Federation.

Analysts say that because these transactions can be lucrative, banks have few incentives to do more than the minimum required by law to check on the identity of a bank.

According to prosecutors, Deutsche Bank is suspected of aiding some 900 customers in setting up offshore companies in tax havens.

The trouble with authorities comes at a time when Deutsche continued to face problems with its business. Whistleblower and former employee Howard Wilkinson has indicated that Danske Bank's management was aware of what was going on at the branch, which was among the bank's most profitable units.

The latest raid is a new blow to Deutsche Bank, which has been hammered by a string of scandals linked to its pre-2008 crisis attempts to compete with Wall Street investment banking giants.

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According to the report, numerous bank records have been seized as part of this raid.

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