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$16m Settlement In US ‘Princelings’ Case To Be Paid By Deutsche Bank


08/26/2019


$16m Settlement In US ‘Princelings’ Case To Be Paid By Deutsche Bank
Settlement of charges that it had employed unqualified relatives of powerful Russian and Chinese government officials to win business will be made by Deutsche Bank for a $16m fine with the United States authorities.
 
False books to record the hirinngs had been used by the Germany’s largest lender, alleged that US Securities and Exchange Commission (SEC). such an action meant that for such relatives of leaders, known in China as “princelings”, the usual rigorous interview processes was not applied by the bank.
 
Highlighting one such nepotism allegation, the SEC said that the son of an executive from a Russian state-owned company did not turn up from work after he was transferred to London from Moscow. It also alleged that the individual was termed as a liability after he cheated in an exam.
 
The Foreign Corrupt Practices Act had been violated by Deutsche Bank by hiring poorly qualified relatives of Russian and Chinese leaders, the SEC alleged. The charges by the SEC had neither been admitted nor denied by Deutsche Bank.
 
Most of such hiring by the bank was done between 2006 and 2014 and most of the relatives of the leaders were appointed in the Asia–Pacific and Russia region. The main aim of the bank behind such appointments was to increase the business of the bank such as by arranging for an initial public offering (IPO).
 
False records that concealed the corrupt hiring practices had been created by the Deutsche Bank employees, the SEC found and the documentation and recording of certain related expenses were not done accurately by the bank.
 
The SEC highlighted five cases as examples to highlight the charges  which included one case about the son of a senior Russian executive who did not report for work after being transferred and was described as “a liability to the reputation of the program, if not their firm”. According to the charge of the case, it is alleged that a email about the son saying that: “FYI . . . the classic nepo situation that we have every year” had been sent by a London-based human resources employee. The SEC further alleged that after two months of the e-mail, the same HR person suggested that the bank should terminate the employment of the individual because “he failed to come to work, cheated on an exam.”
 
The daughter of a “deputy minister” at a Russian state-owned company was hired by the bank as an intern in Moscow in another of the examples highlighted by the SEC. The SEC said that the daughter was later transferred to London  According to the allegations of the SEC, the head of the bank’s Russian office is alleged to have told his UK bosses about the transfer: “We must do it! We should have her in London as it is NOT politically correct to have her in Moscow!”
 
Extensive measures had been taken by Deutsche Bank to make the bank’s hiring policy compatible to regulations and for amending internal accounting controls, the SEC said.
 
 “Deutsche Bank provided substantial cooperation to the SEC in its inquiry and has implemented numerous remedial measures to improve the bank’s hiring practices,” a bank spokesman told the media.
 
(Source:www.theguardian.com)


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