Deutsche Bank (DBK) Alerted by DOJ Possible Breach Criminal Deal

Deutsche Bank Haunted by Control Lapses as U.S. Warns of Breach

Analysis of Form 8-Ks and Form 10-Ks from the past five years shows a burgeoning pattern.

In the latest setback, the Justice Department has told the Frankfurt-based bank that it may have violated a criminal settlement by failing to inform prosecutors about an internal complaint tied to the lender’s asset-management arm, according to a person familiar with the matter.

The complaint from Desiree Fixler, the former head of sustainability at DWS Group, alleged the firm had overstated its commitments to environmental, social, and governance criteria. U.S. prosecutors learned of the allegations only after they were made public in August by the Wall Street Journal, which was also first to report the Justice Department notification.

The potential breach involves a deferred prosecution agreement reached in January between the Justice Department and Deutsche Bank in which the German lender agreed to pay more than $130 million to settle charges that it bribed foreign officials and manipulated the market for precious-metals futures. As part of that accord, the bank vowed to cooperate with investigations and make certain disclosures about allegations of misconduct.

Deutsche Bank’s shares traded lower on the news and were down about just over 2% in early trading.