The US Justice Department is finally investigating Deutsche Bank to see if Germany’s biggest bank violated foreign corruption or anti-money laundering laws when it helped 1Malaysia Development Berhad (1MDB) raise US$1.2 billion (RM4.9 billion).
Citing unnamed sources, the Wall Street Journal (WSJ) said the investigation is focused on the role played by Tan Boon Kee, who was formerly Deutsche Bank’s Asia Pacific head of banking, for its financial-institutions clients and said to have been one of the key bankers in on the 1MDB account.
International financial news wire Bloomberg previously reported her links to Goldman Sachs executive Roger Ng, who introduced Tan to Low Taek Jho, the Penang-born fugitive better known as Jho Low said to have masterminded the misappropriation of 1MDB funds.
WSJ reported Tan left Deutsche Bank last year after it discovered her communications with Low, but it is unclear if she resigned or was sacked.
“Deutsche Bank has cooperated fully with all regulatory and law-enforcement agencies that have made inquiries relating to 1MDB,” an unnamed spokesman for the German bank told WSJ.
The same representative was reported saying that 1MDB made “material misrepresentations and omissions to Deutsche Bank officials” in connection with its transactions with the German bank, adding that the bank’s findings were consistent with what was stated in the US Justice Department’s civil asset forfeiture documents.
According to WSJ, Tan is now working as the group chief business officer of an insurance company called FWD Group, which has a presence in Singapore and Hong Kong.
Citing the latest version of the US Justice Department’s civil asset-forfeiture complaint, the WSJ reported that Deutsche Bank was heavily invested in 1MDB with its name mentioned 167 times in the documents compared to Goldman Sachs, which was mentioned 56 times.
WSJ said the US Justice Department complaint stated Deutsche Bank’s involvement with 1MDB dated back to 2009 in which the German bank was the facilitator for financial transfers for the Malaysian sovereign fund’s first joint venture with PetroSaudi, then a little-known Swiss company.
WSJ reported that Deutsche Bank had also arranged 1MDB’s US $1.2 billion emergency loans that were allegedly stolen by Low and his associates.
The US news outlet said that the Deutsche Bank investigation comes at a sensitive time for the German financial giant as it is currently embroiled in another US criminal money-laundering probe, congressional scrutiny of its relationship with US President Donald Trump and the latter’s associates.
Deutsche Bank was also reported to be in the midst of a global overhaul. The WSJ reported that it laid off thousands of staff last Sunday.