SEC Charges Deutsche Bank with FCPA Violations Related to Third-Party Intermediaries
Jan. 8, 2021
File No. 3-20200
January 8, 2021 - The Securities and Exchange Commission today announced that Deutsche Bank AG will pay more than $43 million to settle charges that it violated the Foreign Corrupt Practices Act (FCPA) in connection with its improper use of third-party intermediaries.
According to the SEC's order, Deutsche Bank engaged foreign officials, their relatives, and their associates as third-party intermediaries, business development consultants, and finders to obtain and retain global business. The order finds that Deutsche Bank lacked sufficient internal accounting controls related to the use and payment of such intermediaries, resulting in approximately $7 million in bribe payments or payments for unknown, undocumented, or unauthorized services. The order further finds that these payments were inaccurately recorded as legitimate business expenses and involved invoices and documentation falsified by Deutsche Bank employees.
The SEC's order finds that Deutsche Bank violated the books and records and internal accounting controls provisions of Sections 13(b)(2)(A) and 13(b)(2)(B) of the Securities Exchange Act of 1934. Deutsche Bank agreed to a cease-and-desist order and to pay disgorgement of $35 million with prejudgment interest of $8 million to settle the action.
The Department of Justice also announced today that Deutsche Bank agreed to a Deferred Prosecution Agreement concerning criminal violations of the books and records and internal accounting control provisions of the FCPA and will pay a criminal penalty of $79 million related to the same misconduct. The SEC did not impose a civil penalty in light of the criminal penalty paid in the criminal resolution.
The SEC's investigation was conducted by Jennifer Moore and Tanya Beard of the FCPA Unit's Salt Lake Regional Office under the supervision of Daniel Wadley.