FRANKFURT, Germany—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.
The hiring, which lasted from at least 2006 through 2014 in the Asia Pacific-region and Russia, violated U.S. laws including the Foreign Corrupt Practices Act, the Securities and Exchange Commission said.
The bank agreed to settle the case without admitting or denying wrongdoing, the SEC said.
Deutsche Bank employees created false books and records that concealed corrupt hiring practices, according to the SEC. Individuals who were offered jobs typically bypassed the bank’s highly competitive and merit-based process, which required that they have high educational qualifications and went through several rounds of interviews. One foreign hire who worked in London performed so badly that a human resources employee deemed him “a liability to the reputation of the program, if not their firm,” the SEC said.
The company agreed to pay a $3 million fine and more than $13 million disgorgement and interest, an amount that the SEC said reflects its level of co-operation, The National reported.
“Deutsche Bank provided substantial co-operation to the SEC in its inquiry and has implemented numerous remedial measures to improve the bank’s hiring practices,” bank spokesman Troy Gravitt told The National.