In 2016 and 2017, computer systems that screen for potential money laundering at Deutsche Bank flagged transactions conducted by legal entities owned by President Donald Trump and White House adviser Jared Kushner as suspicious.
Anti-money laundering specialists at the bank took note, recommending that the transactions be reported to a financial crimes watchdog at the US Treasury Department. But executives at Deutsche Bank dismissed the recommendations, and the report compiled by the specialists was never sent to the government.
That’s according to an exclusive report by the New York Times’s David Enrich, which raises questions about the relationship between Trump and Deutsche Bank. It also opens up yet another line of inquiry about potential corruption and conflict of interest in the White House.
According to the Times, five current and former bank employees claim that Deutsche Bank chose to ignore the concerns raised by the anti-money laundering specialist unit.
Many details about the transactions are murky, and it’s unclear if there was any wrongdoing. Just because the computer systems at Deutsche Bank flagged them as suspicious doesn’t mean that there were any crimes committed. According to experts, the types of businesses operated by the Trump and Kushner families often involve large — but completely legal — cash transfers, particularly from foreign investors, that can seem like money laundering at first glance, which is why specialists review activity banks’ computer programs flag as suspicious.
We do know that some of the suspicious transactions did involve individuals or entities based outside of the US — most notably, Kushner Companies reportedly sent money to Russian individuals. It is also known that some of the transactions involved the president’s now-defunct Trump Foundation, which was shut down during a lawsuit over what New York’s former attorney general called a “shocking pattern of illegality.”
Tammy McFadden, a former anti-money laundering specialist at the bank, told the Times she was fired for questioning her employer for the way it handled the report. Deutsche Bank denies that her questioning was why she was terminated.
Banks have discretion over what they choose to report to financial watchdogs, and the decision by executives to decline to report the flagged activity is not in and of itself a misdeed. But the employees that the Times talked to said that too often Deutsche Bank looks the other way when it’s in the company’s interest.
“[F]ormer Deutsche Bank employees said the decision not to report the Trump and Kushner transactions reflected the bank’s generally lax approach to money laundering laws ... [and] said it was part of a pattern of the bank’s executives rejecting valid reports to protect relationships with lucrative clients,” according to the Times.
Enrich pointed out on Twitter that the whole situation could be “one more reason” that Trump has sought to prevent Deutsche Bank from complying with congressional subpoenas with lawsuits. “The subpoenas seek any materials related to the bank’s detection of suspicious activity in Trump accounts,” he wrote.
While we still do not know why Trump believes those records must be hidden from public view, we do now know, at least in part, what a successful subpoena may have revealed.