U.S. regulators are
expanding their probe into Deutsche Bank AG (DBKGn.DE)(DB.N) as a money
laundering investigation of a Moscow unit has widened into possible sanctions
violations, the Financial Times reported, citing sources.
The U.S. Justice Department and New York State's
Department of Financial Services (DFS) are increasing the scope of their
investigation into the bank because a few transactions allegedly involved U.S.
dollars and a former banker who is a U.S. citizen, the newspaper reported on
Sunday.
The regulatory investigation involving trades worth $6 billon would be
one of the first by the U.S. authorities regarding a potential breach of
Western sanctions against Russia after its 2014 annexation of Crimea, the
business daily said.
Citing sources, Reuters reported in July that the DFS has asked the bank
for detailed information on possible money-laundering transactions by some
clients in Russia that could exceed a total of $6 billion.
The investigation focuses on so-called "mirror trades," which
could allow the movement of funds from one country to another without passing
through normal procedures for cross-border money transfers, the paper reported.
Tim Wiswell, an ex-Deutsche Bank trader, lost his job earlier this year
amid an investigation by European and U.S. regulators into "mirror
trades."
Wiswell sued the bank in October for wrongful
dismissal.
U.S. authorities are now examining whether
his alleged involvement reflected a broader scheme that had been approved by
bank executives, the newspaper said.
The bank, which launched an internal
investigation into Russian securities trades in June, is also being examined to
see if it had compliance programs ready for Russian sanctions and provided
accurate information to regulators, the newspaper said.
"Deutsche Bank has taken disciplinary
measures with regards to certain individuals in this matter and will continue
to do so with respect to others, as warranted," the FT quoted the bank
saying.
The bank's Russian clients subject to U.S.
sanctions include brothers Arkady and Boris Rotenberg, who are close associates
of Russian president Vladimir Putin, the FT reported.
The Justice Department and DFS could not
be reached for comments outside regular business hours.
Reuters could not reach Deutsche Bank and
Tim Wiswell immediately.
(Reporting by Rishika Sadam in Bengaluru; Editing by Jeffrey
Benkoe)
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