Published: Thu, November 29, 2018
Business | By Eloise Houston

German police raid Deutsche Bank in 'Panama Papers' graft probe

German police raid Deutsche Bank in 'Panama Papers' graft probe

Police vehicles are parked in front of Deutsche Bank headquarters as roughly 170 criminal police officers, prosecutors and tax inspectors searched the bank's offices in and around Frankfurt, Germany, on Thursday.

Federal police on Thursday raided the Frankfurt offices of Deutsche Bank. FWIW: Deutsche has been rocked by problems and was the only major global bank to do business with Trump in recent years.

Why are police raiding Deutsche Bank in Germany today?

"We confirm that the police are now conducting an investigation at a number of our offices in Germany", Deutsche Bank said in a statement.

"Just when you thought Deutsche Bank had left its legal troubles behind it, there's more", said Markus Riesselmann, an analyst at Independent Research who recommends investors sell Deutsche Bank shares.

"... 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. "We are cooperating fully with the authorities", it said.

Several Banks including Swedish lenders Nordea and Handelsbanken have already been fined by financial regulators for violating money laundering rules as a result of the papers.

Prosecutors are now examining whether bank employees helped clients set up offshore companies in tax havens in order to launder money between 2013 and 2018.

In 2016 alone, more than 900 customers were served by a Deutsche Bank subsidiary registered on the British Virgin Islands, generating €300m, the prosecutors said.

The investigation was triggered after investigators reviewed so-called Offshore Leaks and Panama Papers disclosures - caches of documents obtained by investigative journalists.

Danske is under investigation for suspicious payments totalling €200bn from 2007 onwards and a source with direct knowledge of the case told Reuters that Deutsche Bank helped to process the bulk of the payments.

And now it seems more allegations have been put against the banks.

Earlier this month, Deutsche confirmed that it was involved in processing payments for the Danish bank in Estonia.

Deutsche Bank shares fell as much as 3% on the news and were down 2.6% as of 11:20 Frankfurt (5:20 a.m. ET).

Several other institutions besides Deutsche Bank have been fined by authorities in the US and Europe for not properly checking up on the beneficial owners of shell companies that send money through their accounts.

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