DoJ investigating German bank's 1MDB dealings

The US investigation into Deutsche Bank's role in 1MDB follows the lender's announcement of an $8.3bn restructuring plan

Germany’s biggest bank under US scope over past dealings with 1MDB

The department is looking into whether Deutsche Bank broke foreign corruption or anti-money laundering laws through its work for 1MDB, which included helping the Malaysian fundraise $1.2 billion in 2014 as concern's about its management and financials had begun to circulate, The Wall Street Journal reported.

United States prosecutors are mainly looking into the role of Tan Boon-Kee, a colleague of a former Goldman Sachs Group Inc executive, Tim Leissner, who worked with him on 1MDB-related business, the paper said.

Deutsche Bank's work for 1MDB included helping to raise US$1.2 billion in 2014 as concerns about the fund's management and financials had begun to circulate, the newspaper said, citing unidentified people familiar with the matter.

A justice department civil asset-forfeiture complaint repeatedly describes Deutsche Bank as being misled by 1MDB officers, the WSJ said.

"Deutsche Bank has cooperated fully with all regulatory and law enforcement agencies that have made inquiries relating to 1MDB", a spokesman for the bank was quoted as saying.

Probes into 1MDB have mainly focused on more than $6 billion the fund raised in 2012 and 2013 with help from Goldman Sachs, which reaped nearly $600 million in fees.

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. The bank has since portrayed Leissner as a rogue employee.

US Justice Department's Assistant Attorney General Brian Benczkowski, said, "We do anticipate getting into active discussions with Goldman, at this point, in the near future".

Leissner, Goldman's former head of Southeast Asia, pleaded guilty past year to the USA charges that he conspired to launder money and violated the Foreign Corrupt Practises Act. He declined to comment on other aspects of the 1MDB case.

The bank also announced Sunday it would make 18,000 job cuts by 2022 about one-fifth of its workforce as it seeks to escape years of turmoil and return to sustained profits.

Tan left Deutsche Bank a year ago after it was discovered she had been in contact with Jho Low, the Malaysian financier who allegedly played a central role in the fraud, according to the Journal. US prosecutors have portrayed Low as the mastermind behind the scandal surrounding 1MDB, though he has consistently denied wrongdoing. Goldman Sachs handled the deals, reaping nearly US$600 million in fees.

Latest News