Commerzbank AG Settles to Pay U.S. Authorities $1.7 Bln

German bank Commerzbank AG has reached a number of settlements with U.S. authorities in relation to violation of U.S. sanctions and violation of New York State business record procedures, occurring between 2002 and 2008 and anti-Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term procedural failures between 2008 and 2013.

The financial institution has reached settlements with a number of regulatory agencies, including the U.S. Department of Justice (DoJ), the Treasury Department’s Office of Foreign Assets Control, the New York County District Attorney’s Office, the Board of Governors of the Federal Reserve and New York’s Department of Financial Services (NYDFS).

In a separate action, Commerzbank AG has put another matter to rest, by agreeing to pay DoJ, the Federal Reserve and the NYDFS a fine related to its failure to maintain and execute adequate policies and practices for identifying money laundering between 2008 and 2013.

The bank announced that it will book an additional Q4 2014 charge related to the event totaling €338 million ($358 million). As a result, Commerzbank AG will adjust its net result for 2014 to €264 million ($280 million) which compares to a preliminarily reported net result of €602 million. The German bank will also adjust its operating result to €684 million ($725 million) from a preliminarily figure totaling €1,022 million.

According to a statement released by the bank, “Commerzbank has been cooperating with U.S. and New York authorities for a number of years, making available extensive documentation as well as the results of various internal investigations that the Bank commissioned. The Bank has also tolled the statute of limitations during these lengthy investigations.”

In conjunction with the settlement, the U.S. Federal Reserve prohibits Commerzbank from re-employing the personnel involved in the actions concerned nor retaining them as third party consultants or contractors.

Commerzbank AG to Double U.S. Based Compliance Compliance In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a Read this Term Staff by 2016

The German bank has already implemented sufficient changes to rectify its procedures and remedy the conduct underlying these enforcement actions. Since 2013, Commerzbank AG has reshuffled its senior compliance staff and intends to do more hiring in the U.S. to double the employees by 2016.

The company’s CEO Martin Blessing, said in an official announcement made by Commerzbank AG, “We take these violations very seriously and deeply regret the actions that led to today’s announcements. Today’s settlement concludes a long and arduous process for all involved. Our focus now is on addressing the underlying issues and maintaining the trust of all of our stakeholders – our clients, our shareholders, our regulators and our employees.”

“We have made, and will continue to make, changes to our systems, training and personnel to address the deficiencies identified by U.S. and New York authorities. The U.S. dollar business remains a central component of our product suite to companies and financial institutions worldwide. As an international bank, we have a keen interest in maintaining the highest industry standards everywhere we do business,” he concluded.