|
The Morning Risk Report: Deutsche Bank Finds Flaw in System That Tracks Suspicious Activity
|
|
|
|
|
|
|
The Deutsche Bank program in question “was configured erroneously with two out of 121 parameters defined incorrectly,” the bank said. PHOTO: THOMAS LOHNES/GETTY IMAGES
|
|
|
Good morning. Deutsche Bank AG found a glitch in computer systems that retroactively scan corporate clients’ transactions for suspicious activity, the latest sign of trouble in the lender’s efforts to guard against potential money laundering by clients.
The glitch, which might have been in place for close to a decade, hampered a program that scans payments involving corporate clients after they pass through the bank so it can flag suspicious patterns to regulators, a person familiar with the matter said. Regulators rely on such information, gathered from a range of financial companies, to prevent money laundering and terrorism funding through the global banking system.
[Continued below...]
|
|
|
|
The problem was discovered by employees in Europe and reported to regulators recently, and the bank is still investigating the problem, the person said. It is unclear which companies, countries or types of cash flows were affected by the transaction-review issues. Deutsche Bank found the problem during its latest revamp of money-laundering systems, which it started late last year.
The Deutsche Bank program in question “was configured erroneously with two out of 121 parameters defined incorrectly,” the bank said. “Deutsche Bank is working on correcting the error as quickly as possible and is in close contact with the regulators.”
|
|
|
|
Agencies Seize Servers of Alleged Cryptocurrency-Laundering Firm
|
|
A cryptocurrency firm that allegedly concealed and laundered money for criminals was shut down following a yearlong investigation into its business, Europol said Wednesday.
Law enforcement agencies seized six servers from Bitmixer.io, a company that specialized in anonymously mixing several kinds of cryptocurrency—including bitcoins, litecoins and bitcoin cash—for customers, according to a statement from the European Union’s law enforcement arm. The servers were located in the Netherlands and Luxembourg, the statement said.
The company, which was established in May 2018, handled at least $200 million in transactions, Europol said. Efforts to locate company executives were unsuccessful.
Dutch investigators first launched a probe into Bitmixer.io in June 2018, with assistance from McAfee, the internet security company based in Santa Clara, Calif., according to Europol. Authorities in Luxembourg also assisted, the law enforcement agency said.
—Kristin Broughton
|
|
|
From Risk & Compliance Journal
|
|
|
|
Securities and Exchange Commission headquarters in Washington. PHOTO: ZACH GIBSON/BLOOMBERG NEWS
|
|
|
U.S. regulators have halted an alleged $30 million Ponzi scheme that included roughly 300 investors and a diamond-related cryptocurrency business, the Securities and Exchange Commission said.
The SEC said that Argyle Coin LLC, a Palm Beach, Fla., company that says it offers investment in cryptocurrency backed by valuable diamonds, and its principal, Jose Angel Aman, were using investor funds to run a Ponzi scheme, according to a statement from the agency.
|
|
|
|
Commerce Secretary Wilbur Ross said in a 2018 letter that the department was looking at Chinese entities as part of ‘steps to prevent the export of items’ that ‘would enable China’s pervasive surveillance and internment system targeting’ Uighurs and other Muslim ethnic minorities. PHOTO: MANISH SWARUP/ASSOCIATED PRESS
|
|
|
-
The U.S. is considering expanding the list of Chinese companies on a blacklist for U.S. suppliers amid escalating tensions between the two economic powers, according to a person familiar with the matter. Meanwhlie, the peril to Huawei Technologies Co.’s global business is growing as foreign partners back away from the Chinese maker of networking equipment and smartphones in the face of U.S. restrictions.
-
The National Rifle Association filed a lawsuit accusing its longtime advertising firm of orchestrating a failed executive coup at the gun-rights group and leaking details about lavish expenses, as part of an alleged attempt to “tarnish and ultimately destroy the public image of the NRA and its senior leadership.”
-
The federal government accused one of the nation’s largest landlords of running a “Ponzi scheme-like” effort using cash from small investors and of misleading banks to obtain bigger loans by using fake loan documents.
-
A Silicon Valley chip startup backed by Microsoft Corp. and Dell Technologies Inc. has accused a top executive at Huawei Technologies Co., Deputy Chairman Eric Xu, of participating in a conspiracy to steal its trade secrets, court documents show.
-
Nepal’s central bank dealt a blow to Chinese mobile-payment giants, including Tencent Holdings Ltd.'s WeChat Pay and Alibaba Group Holding Ltd.'s Alipay, that have been aggressively expanding abroad, restricting the use of these platforms after finding that some transactions they facilitated in the small Himalayan nation flouted its laws.
-
Federal prosecutors charged lawyer Michael Avenatti with stealing hundreds of thousands of dollars owed to his former client, Stormy Daniels, for a book deal the former adult-film actress wrote during her legal battle against President Trump.
-
One of China’s most wanted men has been running a Hollywood movie company, promoting a cryptocurrency venture with boxer Mike Tyson and on one occasion posed for a photo alongside President Trump. Shi Jianxiang is a fugitive from Chinese authorities, who say he committed fraud and caused billions of dollars to vanish.
-
An engineer at an upstate New York company who was responsible for ensuring the quality of parts for Elon Musk’s space venture has been charged with falsifying inspection reports.
|
|
|
|
Mauricio Gutierrez, chief executive of NRG Energy, at a conference in March. At 48 years old, he is younger than most S&P 500 CEOs. PHOTO: F. CARTER SMITH/BLOOMBERG NEWS
|
|
|
-
Chief executives in their 40s are unusual at big U.S. companies, with only about 6% under age 50 among most of the S&P 500, according to a Wall Street Journal analysis.
-
Annual meetings can be snoozefests, but at least Amazon.com Inc.’s investors had a long read to help pass the time. The proxy card for Amazon’s annual meeting convened Wednesday morning contained a record 12 shareholder-sponsored proposals—a significant jump over the three such measures on each of the company’s past three proxies.
-
Facebook Inc. said it stopped paying commissions to employees who sell political ads, as the tech giant overhauls how it engages with campaigns ahead of elections in 2020.
|
|
|
|
Harley expects buyers of electric Hogs—such as the LiveWire, pictured, at the 2019 Consumer Electronics Show in Las Vegas—to be younger and less wealthy than the baby boomers who drove its sales in recent decades. PHOTO: DAVID WILLIAMS/BLOOMBERG NEWS
|
|
|
-
Harley-Davidson Inc. is using loans to reach new riders. The motorcycle maker is introducing 100 new models through 2027, including its first electric bike, to find new customers outside a pack of aging riders in the U.S. Harley expects buyers of those Hogs to be younger and less wealthy than the baby boomers who drove its sales in recent decades, the company has said in recent years, making financing more important to securing their business.
-
Deutsche Bank AG's Chief Executive Christian Sewing signaled the lender will shrink its investment bank as it struggles to stabilize the business and regain support from investors who have pushed its shares to record lows. Mr. Sewing acknowledged the deluge of criticism about performance and compliance failures that executives were prepared to hear.
-
The company that owns Nascar auto-racing venues has agreed to go private, an effort by the family that has long controlled and promoted the motor sport to better position it amid heightened competition for fans. Nascar Holdings Inc. is owned by members of the France family, which also controlled about 75% of the voting power of shares of International Speedway Corp., according to securities filings.
|
|
|
|