The Dubai watchdog has brought the proceedings to enforce compliance with two investigative Notices served on the Dubai International Finance Centre-based arm of Deutsche Bank’s Private Weath Management Business, under Article 80 of the Regulatory Law 2004, requiring the production of information and documents.
The proceedings follow an investigation last December into suspected contraventions by the defendant of various provisions of the DFSA Rulebook, including customer due diligence and money laundering controls.
The DFSA claim, filed at the DIFC courts on 31 October and released publically today, stated: “The claimant at all material times believed,and believes, that the Defendant is or may be able to give information and/or produce documents which are or may be relevant to that investigation.
“In particular, the claimant believed and believes that the Defendant has within its possession or control information and/or documents which may assist in establishing whether its PWM business line has operated consistently with the requirements of the provisions identified above.”
According to the claim, in the course of its investigation, the DFSA served two notices requesting specific client relationship and account details from Deutsche Bank, not all of which it received before the agreed deadlines.
In the Claim, Deutsche Bank defends its actions, citing difficulties arising under Swiss Law. “…the defendant has stated: the potential difficulty that DB DIFC has encountered in providing information responsive to this request, is that GMIS is a global system which sits in Geneva. [. . .] We were concerned that the Art. 271 concern articulated in our recent correspondence may therefore be relevant and could inhibit our ability to provide this information in the requested format."
However, the DFSA made it clear in the claim that it did not think that this was a reasonable excuse and accused the bank of failing to specify the precise basis on why Swiss law prevented it from revealing the information requested.
“There is no reason to believe that Article 271 is engaged in respect of information and documents held by any person outside Switzerland (regardless of whether it was held in Switzerland at some point in the past). The defendant must therefore identify precisely which information or documents it refuses to provide (or arrange to be provided) are held in Switzerland.”
The DFSA is asking the courts to order the bank to hand over all documents and information requested, as well as claiming back its legal costs.
Deutsche is due to file its defence against the DFSA's claim by 5 December. Unless the claim is withdrawn, a trial would take place on 31 July, 2014.
The DFSA has ramped up its legal activity over the past three months, in September it fined United Investment Bank AED183,000 ($50,000, £31,000) for a number of failings in relation to its custodial services while a former banker from BNP Paribas was fined AED73,000 ($20,000, £12,500) and banned from working in the Dubai International Finance Centre for six years.
