Deutsche Bank Securities Agrees to $4M Settlement for Untimely SARs Reporting
By Staff
The U.S. Securities and Exchange Commission announced that it has charged registered broker-dealer Deutsche Bank Securities Inc., a subsidiary of Deutsche Bank AG, for failing to file certain suspicious activity reports, also known as SARs, in a timely manner.
According to the SEC’s order, Deutsche Bank Securities received requests in connection with law enforcement, regulatory investigations, or litigation that prompted it to conduct SARs investigations. The SEC said that, in certain instances from April 2019 to March 2024, however, Deutsche Bank Securities failed to conduct or complete the investigations within a reasonable period of time, including at least two instances where the firm took more than two years to file the SARs.
“Even the best information collected from SARs is of limited use if it’s stale by the time it’s provided to law enforcement,” said Sheldon L. Pollock, associate director of the SEC’s New York regional office. “Through this enforcement action, we are not only holding Deutsche Bank Securities accountable, we are also sending a clear message to other market registrants that timeliness in filing SARs is of paramount importance.”
Broker-dealers are required by the Bank Secrecy Act and regulations promulgated by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network to file SARs for transactions they have reason to suspect involve funds derived from illegal activity, lack a business or apparent lawful purpose, or are intended to facilitate criminal activity.
With these oversights, Deutsche Bank Securities violated Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-8 thereunder, which requires registered broker-dealers to comply with the reporting, record-keeping and record-retention requirements of the Bank Secrecy Act.
Without admitting or denying the SEC’s findings, Deutsche Bank Securities agreed to a censure, a cease-and-desist order, and the civil penalty of $4 million to settle the SEC’s charges.
As previously reported by The DI Wire, Deutsche Bank Securities was similarly penalized by the SEC for off-channel communications in late 2022.
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