Deutsche Bank’s handling of billions of dollars in suspicious transactions from Danske Bank’s Estonian branch is raising the ire of the Federal Reserve, which is looking into it.
Bloomberg, citing two people briefed on the situation who requested anonymity, reported the Federal Reserve’s move to look into how Deutsche Bank handled the transaction adds a new layer to what is amounting to one of the largest money laundering scandals on the books.
According to Bloomberg, the Federal Reserve’s inquiry is at an early stage and is looking at whether or not the U.S. arm of Deutsche Bank did enough to monitor funds from the Estonian branch of Danske Banke. Danske Bank has already said that about $230 billion that came from the Estonian branch may have been bad money. The reported noted that Danske Bank used correspondent banks including Deutsche Bank to move money around the globe.
In the US banks that fall under its jurisdiction are required to flag any money laundering efforts by clients and alert authorities to suspicious transactions. The Fed is one of the regulators that makes sure banks have systems in place to meet that requirement. A Danske Bank whistleblower has previously said that a lot of the money laundering flowed through Deutsche Bank in the US One of the sources told Bloomberg the Fed is looking at its trust bank and that Deutsche Bank has been cooperating with the Federal Reserve.
“There are no probes,” Deutsche Bank said in an emailed statement to Bloo
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