New York regulators slapped Deutsche Bank with a $150 million fine Tuesday over the bank’s relationship with accused sex-trafficker Jeffrey Epstein.
The penalties — which also relate to Deutsche Bank’s ties to scandal-ridden financial institutions Danske Bank Estonia and FBME Bank, — are the first enforcement action by regulators against a bank for dealings with Epstein.
The New York State Department of Financial Services criticized Deutsche Bank, Germany’s largest lender, for “significant compliance failures.”
In the Epstein case, regulators said Deutsche Bank failed to properly monitor account activity conducted on the behalf of the registered sex offender “despite ample information that was publicly available” linked to his earlier criminal misconduct.
“Despite knowing Mr. Epstein’s terrible criminal history, the bank inexcusably failed to detect or prevent millions of dollars of suspicious transactions,” Linda Lacewell, superintendent of New York State Department of Financial Services, said in a statement.
In a statement, Deutsche Bank acknowledged its “error of onboarding Epstein in 2013 and the weaknesses in our processes, and have learnt from our mistakes and shortcomings.”
The bank said it immediately contacted law enforcement to offer assistance after Epstein’s arrest. It has also invested nearly $1 billion in training, controls and operational processes and has hired more than 1,500 people to its financial crime team.
“Our reputation is our most valuable asset and we deeply regret our association with Epstein,” the bank said.
