The Securities and Exchange Commission today charged registered broker-dealer Deutsche Bank Securities Inc., a subsidiary of Deutsche Bank AG, for failing to file certain Suspicious Activity Reports (SARs) in a timely manner.
Deutsche Bank Securities has agreed to pay a $4 million civil penalty to settle the SEC’s charges.
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.
According to the SEC’s order, Deutsche Bank Securities received requests in connection with law enforcement or regulatory investigations or litigation that prompted it to conduct SARs investigations. However, the SEC’s order finds that, in certain instances from April 2019 to March 2024, Deutsche Bank Securities failed to conduct or complete the investigations within a reasonable period of time, including at least two instances where Deutsche Bank Securities took more than two years to file the SARs.
“Even the best information collected from SARs is of limited use if its 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.”
The SEC’s order finds that Deutsche Bank Securities violated Section 17(a) of the Securities Exchange Act and Rule 17a-8 thereunder. Without admitting or denying the SEC’s findings, Deutsche Bank Securities agreed to a censure, a cease-and-desist order, and the civil penalty referenced above.
The SEC’s investigation was conducted by Alicia Guo, Joshua Tannen, and Steven G. Rawlings of the SEC’s New York Regional Office, and Joy Guo of the Boston Regional Office, with assistance from Daniel Goldberg, Andrae Eccles, Damon Reed, David Cohen, Susan Schneider, and Naomi Sevilla of the Office of Market Intelligence’s Bank Secrecy Act Review Group. The investigation was supervised by Mr. Pollock. The examination that led to the investigation of Deutsche Bank Securities was conducted by Dwight Fu and Lisa Jordan of the Division of Examinations.