Deutsche Bank fined $150M US for failing to monitor Jeffrey Epstein transactions

Deutsche Bank AG has agreed to pay $150 million US in penalties to settle charges by a New York state regulator that the bank had “significant” compliance failures in its relationships with the late financier Jeffrey Epstein, Danske Bank Estonia and FBME Bank.

The New York State Department of Financial Services said on Tuesday that the agreement marks the first regulatory enforcement action against a financial institution for dealings with Epstein, the registered sex offender who died by suicide in August 2019.

“For years, Mr. Epstein’s criminal, abusive behaviour was widely known, yet big institutions continued to excuse that history and lend their credibility or services for financial gain,” New York Gov. Andrew Cuomo said in a statement.

New York said Deutsche Bank failed to properly monitor Epstein’s transactions despite “ample” publicly available information about his sexual misconduct.

It said this led to the bank processing hundreds of transactions for Epstein that should have prompted more scrutiny, including payments to victims, alleged accomplices and law firms representing Epstein and the accomplices.

Penalties related to Danske Bank scandal

In the cases of Danske Estonia, which is embroiled in a money laundering scandal, and FBME, New York said Deutsche Bank failed to properly monitor their correspondent and dollar-clearing businesses.

Deutsche Bank Chief Executive Christian Sewing told staff in an internal memo on Tuesday that it was a “critical mistake” to take Epstein on as a client in 2013, just a few years after he had served a sentence in Florida as part of a controversial plea deal.

The bank also acknowledged deficiencies in its monitoring of Danske Estonia and FBME.

“We all have to help ensure that this kind of thing does not happen again,” Sewing said.

WATCH l Ghislaine Maxwell arrest ‘long overdue for victims’ says rights lawyer Gloria Allred:

Representing 16 of Jeffrey Epstein’s victims, the celebrated women’s rights lawyer, Gloria Allred, speaks to the CBC’s Hannah Thibedeau about the arrest of Epstein’s former girlfriend, Ghislaine Maxwell, on charges that include recruiting and abusing underage girls.   9:04

Epstein was awaiting trial last year on new federal charges of trafficking minors between 2002 and 2005 when he was found dead in a federal jail in New York City.

Ghislaine Maxwell, the socialite accused of luring underage girls so Epstein could sexually abuse them, was arrested last week in New Hampshire.

She is expected to appear by video from the federal Metropolitan Detention Center in Brooklyn on Friday for a court hearing.

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