US probes Deutsche Bank’s dealings with Malaysia’s 1MDB

Deutsche Bank faces US investigation into 1MDB WSJ says

Deutsche Bank faces US investigation into 1MDB WSJ says

U.S. officials are investigating whether the crisis-hit Deutsche Bank violated foreign corruption or anti-money-laundering laws in its work for the Malaysian state fund 1MDB, according to reports.

Prosecutors are looking into the role of Ms Tan Boon Kee, a colleague of former Goldman Sachs Group executive Tim Leissner, whom she worked with on 1MDB business, the paper said.

Germany's Deutsche Bank points to asset forfeiture documents filed by the US DoJ that show it had been misled by 1MDB.

The WSJ said prosecutors have been investigating similar issues at Goldman, where Leissner, a former managing director, pleaded guilty past year and admitted to earlier helping siphon off billions of dollars from the fund.

"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.

WSJ reported that Deutsche Bank had also arranged 1MDB's U.S. $1.2 billion emergency loans that were allegedly stolen by Low and his associates.

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 who circumvented the bank's internal controls.

Still, the Justice Department expects to start negotiating with the New York-based firm soon to resolve a criminal probe of the bank, WSJ wrote. Deutsche has paid more than $18 billion in fines and other legal costs over the decade.

In recent years, regulators and prosecutors have raided the bank's headquarters, subpoenaed documents and grilled executives in dozens of probes on three continents. The former head of Southeast Asia at Goldman pleaded guilty to US charges that he conspired to launder money and violated the Foreign Corrupt Practices Act.

The probe of Deutsche Bank comes just as the lender said it will cut a fifth of its 91,000-person workforce and exit some business segments as it seeks to improve profitability.

Tan left Deutsche Bank previous year, after the bank discovered communications between her and Low Taek Jho, better known as Jho Low, the Malaysian financier that the US DoJ has described as the central player in the 1MDB scandal, according to a person familiar with her exit. Leissner also agreed to forfeit $43.7 million and admitted to bribing officials in Malaysia and the UAE to get bond deals for Goldman Sachs. USA prosecutors are now examining the same executive, according to the Journal's report.

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