Commerzbank under US probe for money laundering

30th September 2014, Comments 0 comments

Germany's second largest bank Commerzbank is under investigation in the United States for violating money-laundering rules, a source close to the case told AFP Tuesday.

The investigation comes as the bank is close to settling a separate probe on violating US embargoes on doing business with countries under sanctions, the source said.

The new probe comes from the US attorney in Manhattan, who is investigating the bank for poor internal controls aimed at preventing money laundering.

The bank declined to comment on the issue, after the Wall Street Journal first reported it.

But in October 2013 the US Federal Reserve ordered Commerzbank to undergo an independent audit to strengthen its anti-money laundering measures.

The independent evaluation was to focus on "suspicious activity" that took place in the bank's US branch between May and October 2012, the Fed said at the time.

Commerzbank already has been the subject of investigations in the United States concerning transactions with countries under US sanctions, such as Iran and North Korea.

The source said those investigations, involving the Fed, the Justice Department and the New York state banking regulator, are close to being resolved, with a possible fine against the bank of $600-650 million.

The New York regulator is also pressing the bank to fire a number of senior officials said to be responsable for the violations.

But the bank will not be forced to plead guilty to criminal charges, as the French bank BNP Paribas was in June, when it was hit with a record $8.9 billion fine for sanctions violations and for attempting to block investigations by the regulators.

The largest German bank, Deutsche Bank, is also being probed over sanctions violations.


© 2014 AFP

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