Deutsche Bank In Trouble: SEC Fines The Bank $4m For Delayed Filing Of Suspicious Activity Report
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Deutsche Bank’s subsidiary, Deutsche Bank Securities Inc., recently agreed to pay a $4 million civil penalty following the US Securities And Exchange Commission’s (SEC) charges for not filing the Suspicious Activity Reports (SARs) within a period of time designated by the law.
According to the SEC, the bank’s securities-handling subsidiary, which is a registered broker-dealer, violated the obligations issued by the Bank Secrecy Act. As a direct consequence, it also violated multiple related regulations by delaying the filing of the SAR.
The regulator claims that the company did not report suspicious transactions in a timely manner during the period between April 2019 and March 2024. The bank’s failure to act promptly resulted in at least two instances where SARs were filed over two years after the suspicious events took place.
Meanwhile, the US Department of the Treasury’s Financial Crimes Enforcement Network, or FinCEN, obligates financial firms to file SARs when transactions raise suspicions of illegal activity. The obligation also stands if there is a lack of an apparent lawful purpose, or if conducting it may facilitate criminal conduct.
The Las Enforcement Needs Fresh Information To Achieve Results
Deutsche Bank Securities neither admitted nor denied the findings. Instead, it consented to a censure, as well as a cease-and-desist order, and it agreed to pay a massive $4 million penalty.
For the SEC, the case represents the regulator’s commitment to enforcing compliance with AML obligations and ensuring market integrity. The regulator believes that timely reporting and accountability are the key to ensuring that the market remains safe for all participants.
Associate Director of the SEC’s New York Regional Office, Sheldon L. Pollock, commented on the matter, stating that even the best information collected from SARs is of limited use if it is stale by the time it is provided to law enforcement. In other words, if there is suspicious activity, law enforcement needs to receive the information quickly in order to react in time to counter it.
“Through this enforcement action, we are not only holding Deutsche Bank Securities accountable, but we are also sending a clear message to other market registrants that timeliness in filing SARs is of paramount importance,” Pollock added.
