Frankfurt prosecutors and police on Thursday raided several Deutsche Bank offices, including its Frankfurt headquarters, searching for clues of alleged tax avoidance from 2013 to today. About 170 officers were involved in the raids that began this morning and will continue tomorrow.
"It’s true that the police are currently investigating several of our bank’s sites in Germany. The issue is the Panama Papers," the bank said in a brief release. "We will cooperate fully with the authorities."
The investigators are looking at two Deutsche Bank employees as well as other unidentified managers, according to Reuters. Information from the Offshore Leaks documents from 2013 and the Panama Papers from 2015, which shed light on the complicated assets of the world’s ultrawealthy, allegedly indicates that Deutsche may have helped clients set up offshore accounts to hide funds from tax offices.
Confidence down, shares down
One of Deutsche’s units in the British Virgin Islands reportedly counted more than 900 customers and oversaw €311 million ($354 million) in customer cash in 2016.
The investigation, according to Reuters, focuses on whether customers transferred funds earned from criminal activities to the bank. Reportedly, some clients seemed fishy from the start, but the bank did not ask authorities to investigate.
Deutsche Bank shares tumbled as much as 4.9 percent to €8.17 as investors reacted to the latest indication that Germany’s biggest bank is still struggling with internal controls.
The share price is just a smidge over the record low it hit earlier this month, when Deutsche was implicated in the Danske Bank money-laundering scandal. Deutsche acted as a correspondence bank for some of the sketchy transactions, working as an intermediary that transferred money from one bank to another.
But that was just the latest sign Deutsche’s compliance department is still dropping the ball. John Cryan was forced out in April after just three years as CEO because of his inability to protect the lender from continued regulatory and legal snafus, as well as three straight years of losses.
Andrew Bulkeley is an editor with Handelsblatt Today in Berlin. To contact the author: [email protected]