(Bloomberg) — Deutsche Bank AG was raided by German authorities on Wednesday as part of a money laundering probe looking at past dealings by staff with firms linked to the now-sanctioned Roman Abramovich, setting back the lender\u2019s long-running effort to shed a previous reputation as a magnet for scandals.<\/p>\n
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Speaking at a previously scheduled earnings press conference the following day, Deutsche Bank Chief Executive Officer Christian Sewing said the investigation related to transactions between 2013 and 2018.<\/p>\n
\u201cThe starting point is an allegedly late report of suspected money laundering,\u201d Sewing said. \u201cOn this basis, the public prosecutor\u2019s office is investigating whether there are any indications of possible money laundering.\u201d<\/p>\n
The lender \u201chas maintained business relationships in the past with foreign companies which, in turn, are suspected of having been used for money laundering purposes as part of further investigations,\u201d the Frankfurt prosecutor\u2019s office said in a statement Wednesday without identifying the firms.<\/p>\n
It\u2019s raiding Deutsche Bank premises in Frankfurt and Berlin to investigate the matter, it said. Prosecutors haven\u2019t named any suspects yet.<\/p>\n
\u201cThe searches haven\u2019t been formally concluded,\u201d the agency said on Thursday when contacted again.<\/p>\n
The firms are linked to Abramovich, people familiar with the matter said, asking not to be identified discussing an ongoing investigation. Abramovich himself isn\u2019t being investigated, other people said.<\/p>\n
Deutsche Bank \u201cis cooperating fully,\u201d the lender said in a statement on Wednesday.<\/p>\n
Abramovich \u201chas no connection to these searches and is neither under investigation nor suspected of any wrongdoing,\u201d a representative for the billionaire said in an updated statement on Thursday.<\/p>\n
Setback for Sewing<\/p>\n
It\u2019s a setback for Sewing who is widely credited with turning around the lender. He\u2019s drawn a line under a long period of scandals and losses after taking over almost eight years ago.<\/p>\n
Deutsche Bank has repeatedly been searched in the past and the latest instance could reopen memories of a time when regulators around the globe where criticizing the firm for failing anti-money laundering controls, and sometimes ended up imposing fines on it over the matter. The bank\u2019s share price dropped on the news on Wednesday.<\/p>\n
The developments also overshadowed Deutsche Bank\u2019s earnings report on Thursday. The lender disclosed a record full-year profit and unveiled a new share buyback.<\/p>\n
Stock Drop<\/p>\n
Shares in the German bank closed down about 2% on Wednesday and continued to fall on Thursday after the publication of the firm\u2019s results.<\/p>\n
Media outlet Sueddeutsche Zeitung first reported the news.<\/p>\n
Deutsche Bank was under various CEOs between 2013 and 2018, including Anshu Jain and John Cryan. Sewing took over in April 2018, though he has been a member of the lender\u2019s executive board since 2015.<\/p>\n
\u201cIn recent days, media reports have linked Mr Abramovich to searches carried out at Deutsche Bank. These reports are entirely false and inaccurate,\u201d the representative for the billionaire said.<\/p>\n
The raids \u201chave nothing to do with Mr. Abramovich whose name was only used as a way to draw media attention to the investigation.\u201d<\/p>\n
Banks are required to maintain strict controls on the money flowing through them in an effort to prevent illicit movements. Deutsche Bank in the past was often criticized for deficient controls around such activities and it has invested heavily to improve them.<\/p>\n
Abramovich made his fortune in Russia\u2019s metals and energy industries and became internationally known after purchasing Chelsea Football Club. Abramovich enjoys \u201cprivileged access\u201d to Russian President Vladimir Putin that helps him \u201cto maintain his considerable wealth,\u201d the European Union said in March 2022 when it sanctioned him.<\/p>\n
–With assistance from Jeremy Hodges and Irina Reznik.<\/p>\n
(Corrects to clarify focus of the Deutsche Bank raid in headline, seventh paragraph.)<\/p>\n
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