Authorities are carrying out investigations at several German offices of Deutsche Bank over the Panama Papers scandal.
German police and the country’s public prosecutor’s office conducted searches on Thursday morning, including Deutsche Bank’s headquarters in central Frankfurt, in connection with the 2016 leak of around 11.5 million documents from Panama-based law firm Mossack Fonseca.
BBC reports suggest that prosecutors are looking into whether Deutsche Bank staff helped clients set up offshore accounts to “transfer money from criminal activities”.
Deutsche Bank said in a statement: “We confirm that the police are currently conducting an investigation at a number of our offices in Germany. The investigation relates to the Panama Papers.
“We will be issuing further details in due course. We are cooperating fully with the authorities.”
Paperwork and electronic documents were seized by officials during the raids.
The Panama Papers exposed the offshore holdings of politicians, sports stars and public officials around the world in 2016, after emails, bank records and client documents spanning from 1977 to 2015 were leaked to German newspaper Süddeutsche Zeitung.
Panama scandal resurfacing
This latest investigation sparked by the Panama Papers has opened up questions about the future of the offshore world and what will happen if more European financial institutions are caught up in the scandal.
Miles Dean, partner at Milestone International Tax, said: “It isn’t surprising that the effects of the Panama Papers are still being felt – the amount of information and resources available to tax authorities means that certain time lags are inevitable.
“The fact that Deutsche Bank’s share price has dropped by 3% in the wake of this latest scandal shows how important it is for banks to ensure that they have systems in place to prevent their employees from being at the centre of money laundering.
“Without banks, illicit funds – whether from criminal activity or tax evasion – cannot be laundered, so weak links within banks always have been and will, to an extent, continue to be integral.
“Thanks to global initiatives, such as the Foreign Account Tax Compliance Act (Fatca) and the Common Reporting Standard (CRS), the use of offshore trusts and companies has been significantly curtailed.
“That said, for legitimate transactions and tax planning, trusts and companies can still be deployed and remain useful tools for the tax practitioner.”
