Money laundering is the intentional movement of cash and/or assets derived from illegal and criminal activities into legal financial and business systems, eliminating audit trails. Placement, layering, and integration are the main components of the money laundering process. Predicated offenses are defined by local law and range from forgery of money, extortionate robbery, and drug crime to fraud, corruption, organized crime, or terrorism.
Terrorism financing means providing, depositing, distributing, or collecting funds, by any means, intended to be used, or knowing that they are to be wholly or partially used, for committing terrorist acts. It is irrelevant whether such funds are of legal or illegal origin.
Our AML program is designed to comply with German AML rules as a minimum, and local laws, regulations, and guidance relating to the prevention of money laundering, terrorist financing, and related crimes. It includes policies, procedures, a designated Money Laundering Officer, regular employee training (for those who are in scope), and independent controls. We are also a member of the Wolfsberg Group of Banks and have adopted the Wolfsberg Anti-Money Laundering Principles, as well as signed the Wolfsberg Statement on the Suppression of the Financing of Terrorism.
Given the sophistication of some money laundering attempts, we rely on our risk management systems and controls, transaction monitoring, and KYC processes. Our AML teams are responsible for establishing and monitoring measures to prevent, detect, and advise on money laundering and the financing of terrorism. Our group-wide AML Policy (supported by our KYC Policy) commits us to:
- fulfil regulations governing identification (authentication), recording, and archiving;
- detect suspicious transactions and process internal suspicious-activity alerts;
- develop, update, and implement internal policies, procedures, and controls; and
- create staff awareness, set a staff reliability process, and provide training.
These policies are put into practice at the front line of our business. They are continually monitored and updated at least once a year.
Know Your Customer
Effective group-wide KYC standards are governed by stringent regulations and help us to protect Deutsche Bank from criminal abuse. In 2015, we continued to renew a policy framework in every country Deutsche Bank operates in, paying special attention to high-risk clients and “politically exposed persons.” Clients are assessed as part of due diligence and are screened at least monthly against internal and external criteria that cover terrorist financing, financial crime, corruption, and tax evasion.
Negative due diligence may mean that a client relationship is declined or subject to monitoring or conditions imposed on accounts, transactions, or product usage. Furthermore, as laid out in our Strategy 2020, client segments are terminated where risks are too high. In cases of suspicious activity, regulatory and government bodies are informed according to existing legal and regulatory requirements.
In 2015, we continued to roll out an extended screening program, which now covers approximately 95% of relevant data sources. In addition, we also developed a new technical screening platform. The new IT platform will serve as the basis for further enhancement with regards to screening effectiveness and efficiency. The first pilot is planned for 2016.
In March 2015, our Global Transaction Banking division joined the global SWIFT KYC Registry, a centralized repository for banks to streamline their due diligence processes. The registry allows the SWIFT community to upload, update, and manage their own KYC-related information and documentation and to share it upon request with their correspondent banks in a secure environment. We have registered Deutsche Bank branches and subsidiaries from more than 35 countries where we are contributing the predefined information and documentation.