UK sanctions authorities have penalised Deutsche Bank’s London branch £165,000 ($221,154) after the lender handled payments linked to a sanctioned Russian-owned business.
The Office of Financial Sanctions Implementation, part of HM Treasury, said the case concerned payments made in 2022 for a client to Okko, a Russian video streaming platform owned by JSC New Opportunities, an entity under UK sanctions.
The bank had partly depended on an external provider for sanctions screening at the time and that the arrangement failed to identify problems connected to Okko’s ownership.
The regulator said: “[Deutsche] remained ultimately responsible for ensuring it acts in compliance with financial sanctions when processing payments on behalf of its customers.”
The penalty comes shortly after Deutsche referred itself to EU authorities over possible breaches of sanctions rules involving Russian clients.
The bank found instances in its retail division where deposits above €100,000 had been accepted from people covered by EU sanctions restrictions.
Deutsche’s disclosure of the Okko transactions to OFSI meant it received a reduction in the penalty.
In March, OFSI also imposed a fine on Apple’s European subsidiary over payments involving Okko, reported Financial Times.
Okko belonged to Sberbank, Russia’s biggest bank, from August 2018 until May 2022.
It was then transferred to New Opportunities, a Moscow-based company set up only weeks earlier. The UK sanctioned New Opportunities in June 2022 after Russia’s invasion of Ukraine.
Deutsche handled two payments to Okko in June and July 2022 with a combined value of £636,000.
Civil penalties from OFSI are uncommon, with fewer than 20 issued since 2019. In January, the regulator also fined Lloyds Banking Group over the opening of an account for an associate of Russian President Vladimir Putin.
Deutsche said: “After identifying two payments to a Russian entity that had become affiliated with a sanctioned entity, we voluntarily disclosed this to OFSI. Deutsche Bank takes sanctions compliance extremely seriously.
“We have strengthened and continue to strengthen all aspects of our sanctions compliance framework and associated processes.”
“UK fines Deutsche Bank over Russian sanctions breach ” was originally created and published by Private Banker International, a GlobalData owned brand.
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