FRANKFURT, Germany—Deutsche Bank has joined a blockchain network of more than 300 banks led by JP Morgan. Deutsche Bank is now the latest member of the blockchain-based Interbank Information Network (IIN), Yahoo finance reported. Separately, U.S. regulators are probing potential money laundering issues at Deutsche Bank.
Members of the IIN share information on global payments through blockchain technology. The goal is to enable payments that are not subject to costly delays, which currently affect roughly 1.5% of all cross-border payments, Yahoo Finance noted.
To achieve this goal, the banks said they are ensuring all relevant information about any transfers is immediately accessible to other members of the IIN.
JP Morgan acts as a correspondent bank to process payments made using the U.S. dollar, Yahoo Finance said.
Deutsche Bank, meanwhile, is the largest clearer of euro-denominated payments in the world. As such, it is believed that in joining the IIN Deutsche Bank will be able to provide greater services for European clients as well as lower the cost of processing difficult payments, Yahoo Finance said.
“Our competitors are not just the other banks, it’s also new players in the market. We need to become efficient enough to provide seamless real-time and digital processes,” said Ole Matthiessen, head of Deutsche Bank’s cash management division.
Possible Money Laundering Issues
Meanwhile, U.S. congressional investigators have found possible failures in Deutsche Bank AG’s money laundering controls.
Sources familiar with the matter told Reuters Deutsche Bank handed over numerous transaction records, emails and other documents, and investigators discovered instances in which staff noted concerns about new and existing Russian clients — only to be ignored by managers.
The investigation, which is also looking into whether the lender acted as a correspondent bank to facilitate the movement of illegal funds into the United States, is in the early stages, Reuters reported.
Deutsche Bank spokesperson Troy Gravitt said the bank cannot comment on the ongoing probe, but it remains committed to cooperating with the congressional investigators.
“We have worked to address them, taken disciplinary measures with regards to certain individuals and reviewed our client onboarding and monitoring processes,” Gravitt said.
Fines Previously Paid
In 2017, Deutsche Bank agreed to pay regulators in the U.S. and the U.K. $630 million in fines for organizing $10 billion in fraudulent trades that might have been used to launder money out of Russia.
As CUToday.info recently reported, Deutsche Bank will pay $16.2 million to settle a U.S. regulator’s allegations that it hired relatives of overseas government officials to win business.