Deutsche Bank to Pay $125 Million to Resolve FCPA, Fraud Cases

Deutsche Bank on Friday agreed to pay more than $125 million to resolve allegations that it violated the Foreign Corrupt Practices Act and schemed to commit fraud, according to a deferred prosecution agreement unsealed in the U.S. District Court for the Eastern District of New York.

Under the agreement, the Germany-based bank will pay $85 million in criminal penalties and more than $40 million to the U.S. Securities & Exchange Commission to resolve a criminal information alleging that the bank was involved in a scheme to hide bribes to “decisionmakers” in Saudi Arabia and the United Arab Emirates.

The information charged Deutsche Bank with one count of conspiracy to violate the FCPA’s books and records and internal accounting controls provisions and one count of conspiracy to commit wire fraud affecting a financial institution.

Joseph Salama, Deutsche Bank’s general counsel for the Americas, agreed to the resolution during a virtual hearing before U.S. District Judge Rachel Kovner on Friday. He appeared alongside Gibson, Dunn & Crutcher partner Richard Grime, who is representing Deutsche Bank; Grime did not respond to a request for comment Friday.

In a statement released Friday, the bank emphasized that it has sought to improve its compliance and crime prevention efforts in recent years.

“While we cannot comment on the specifics of the resolutions, we take responsibility for these past actions, which took place between 2008 and 2017,” the statement said. “Our thorough internal investigations, and full cooperation with the DOJ and SEC investigations of these matters, reflect our transparency and determination to put these matters firmly in the past. As recognized in the resolutions, we have taken significant remedial actions in response to these issues.”

Acting U.S. Attorney Seth DuCharme said the resolution is part of prosecutors’ commitment to holding financial institutions responsible.

“Deutsche Bank engaged in a criminal scheme to conceal payments to so-called consultants worldwide who served as conduits for bribes to foreign officials and others so that they could unfairly obtain and retain lucrative business projects,” DuCharme said. “This Office will continue to hold responsible financial institutions that operate in the United States and engage in practices to facilitate criminal activity in order to increase their bottom line.”

The resolution comes after a series of challenges for Deutsche Bank. In July, New York State’s Department of Financial Services announced the bank would pay a $150 million penalty due in part to its relationship with Jeffrey Epstein.

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