Deutsche Bank under fire in the US
23.07.14 @ 09:16
BRUSSELS - Two separate reports by the US central bank and the Senate have criticised Deutsche Bank for having internal irregularities and for helping investment funds to avoid taxes.
Documents obtained by the Wall Street Journal show that Germany's largest commercial bank has produced "low quality, inaccurate and unreliable" reports to the Federal Reserve Bank of New York.
"The size and breadth of errors strongly suggest that the firm's entire US regulatory reporting structure requires wide-ranging remedial action," the Fed paper concludes.
Separately, an investigation by the US Senate into the dealings of Deutsche Bank and Barclays, two of Europe's largest banks, concluded on Tuesday (22 July) that they have sold complex financial products which allowed hedge funds to avoid US taxes.
The scheme has cost the US government billions of dollars in tax revenues, according to the Senate report, which does not say that Deutsche Bank has done anything illegal.
The two probes are only the latest in a series of scandals and legal disputes, notably fraud and rate fixing, which have seriously dented the image of Germany's largest commercial bank and weighed on its profits.
Back in January, Deutsche Bank posted losses of €1.15 billion for the previous three months due to heavy costs for litigation and restructuring and warned that in 2014 more of this will happen.