AI Content Chat (Beta) logo

Deutsche Bank Governance and operations Non-Financial Report 2022 Anti-financial crime Key topics in 2022 GRI 3-3 Resources and transformation execution There are dedicated employees within AFC, the business divisions, and Deutsche Bank’s technology function whose main task is to manage financial crime risks. In 2022, AFC initiated a hiring strategy to strengthen execution and leadership capabilities, which led to a substantial increase of AFC’s headcount. The AFC leadership team was enhanced with a number of senior hires including heads for the regions Americas, United Kingdom and Ireland, and a Head of Financial Crime Data & Risk Intelligence. At year end 2022, AFC had 1,932 employees (Full Time Equivalent, FTE), which is an increase of 343 FTE as compared to 2021. At year end 2022, AFC was also supported by 192 contingent workers. Beyond hiring, Deutsche Bank continued to execute core change initiatives focused on remediating internally and externally identified issues and proactively enhancing controls for financial crime risks. The oversight of the central financial crime risk remediation program now falls under the additional oversight of Deutsche Bank’s Chief Transformation Office for consistency and to support the integration across remediation plans. This central program is expected to move Deutsche Bank into a sustainable environment, including robust Know Your Client (KYC) checks by business divisions for client adoption, ongoing monitoring by control functions, dynamic risk assessments, risk appetite matching and independent audits by a specialized audit team. Partnerships The fight against financial crime requires an exchange of knowledge and experiences to improve and further develop an effective management of financial crime risks. In 2022, Deutsche Bank deepened its existing industry engagements by strengthening its ties with its associations, such as the Wolfsberg Group of Banks, but also its involvement in public private partnerships (collaborations between the public and private sector), such as (1) the German Anti Financial Crime Alliance (AFCA) which is composed of representatives from both the financial and non-financial sector, as well as the public authorities including Germany’s Financial Intelligence Unit, German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) and the German Federal Criminal Police Office (Bundeskriminalamt, BKA) and where Deutsche Bank’s Management Board member Stefan Simon became part of the AFCA Board; (2) Europol’s Financial Intelligence Public Private Partnership (EFIPPP) where the deputy Head of AFC became part of EFIPPP’s Steering Group and (3) the UK Joint Money Laundering Intelligence Taskforce. Furthermore, Deutsche Bank and Visa announced a collaboration on the prevention of online retail frauds with an automated fraud detection system, Cybersource, owned by Visa. Russian sanctions The Russian invasion of Ukraine led to a significant increase in sanctions against Russian state entities, companies and individuals linked to Russia. Deutsche Bank manages these sanctions with enhanced communications, guidance, and operational support led by AFC’s Sanctions & Embargoes team. Orders and fines related to financial crime risk On September 28, 2022, BaFin ordered Deutsche Bank AG to take specific measures aimed at preventing money laundering and terrorist financing in order to implement the orders that BaFin issued on September 21, 2018, and February 15, 2019. In July 2022 the bank accepted a fine of € 7 million for the administrative offence of delayed filing of two Suspicious Activity Reports (SAR) in a historic matter thereby ending the Frankfurt public prosecutor’s investigation into this matter, in relation to which a search took place at Deutsche Bank’s headquarters on April 29, 2022. Risk exposure and controls GRI 2-23/24/25/26, 3-3, 205-1/2/3, FS1, FS3 Deutsche Bank’s inherent exposure to financial crime risks is influenced by its clients’ footprint and transaction behavior, the geographies in which it operates, the products and services offered, and the sales channels used. The exposure to various financial crime risks is subsumed under money laundering, terrorist financing, sanctions and embargoes, internal and external fraud and bribery and corruption. 86

Deutsche Bank Non Financial Report  - Page 87 Deutsche Bank Non Financial Report Page 86 Page 88