German multinational bank resolves SEC investigation of FCPA violations, agrees to pay $16 million

On August 22, 2019, the Securities and Exchange Commission issued an order finding that Deutsche Bank AG had violated the books and records and internal accounting controls provisions of the US Foreign Corrupt Practices Act.  According to the order, which Deutsche Bank consented to on a neither-admit-nor-deny basis, between 2006 and 2015 Deutsche Bank employees created false books and records to conceal corrupt hiring practices designed to employ the relatives of foreign government officials in various countries, including China and Russia, “as a personal benefit to the officials in order to improperly influence them to assist the bank in obtaining or retaining business or other benefits.”  Deutsche Bank’s internal controls—including Deutsche Bank’s Global Anti-corruption Policy expressly prohibiting these hiring practices since at least 2009, and Deutsche Bank’s 2010 enactment of a written “APAC Hiring Policy” to prevent irregular hiring in the APAC region—were insufficient to prevent this misconduct. The order requires Deutsche Bank to disgorge $10,785,900, pay $2,392,950 in prejudgment interest, and pay a $3,000,000 civil penalty.  The order stated that the SEC had limited the civil penalty as a result of Deutsche Bank’s cooperation with the SEC’s investigation, and the remedial efforts undertaken by the bank, including enhancements to its anti-corruption compliance program and hiring practices, increased anti-bribery training that specifically addresses hiring practices, and appropriate personnel action.

SEC order

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