BaFin, Germany’s financial supervisory authority, has levied fines totaling €1.45 million (equivalent to U.S. $1.6 million) against Commerzbank AG to address issues concerning supervision and anti-money laundering (AML) measures, as well as breaches of its supervisory obligations and enhanced due diligence requirements.
On Monday, BaFin announced fines of €375,000 (U.S. $400,000) and nearly €1.1 million (U.S. $1.2 million) against Commerzbank, with some of the alleged violations pertaining to matters at Comdirect Bank AG, for which Commerzbank serves as the universal successor.
According to BaFin, employees were found to have failed to meet AML obligations by not promptly or adequately updating customer data and implementing insufficient internal security measures. Additionally, BaFin stated that the breach of supervisory duties resulted in inadequate application of enhanced due diligence requirements in three instances.
In response to inquiries, a spokesperson for the bank stated that a review was conducted to integrate Comdirect into Commerzbank, focusing on the existing protocols for new customer identity checks and the procedures for updating customer data at Comdirect. As a result of this review, adjustments were deemed necessary, with processes being adapted and data updates being fully completed by early 2022.
Under Germany’s Money Laundering Act, credit institutions are mandated to establish operational guidelines for the practical implementation of the act’s requirements, including the regular updating of customer data. BaFin emphasized that maintaining proper relationship management is crucial for credit institutions to prevent anonymous account openings and misuse for money laundering purposes. Accordingly, credit institutions are obligated to identify all customers when initiating a business relationship and meticulously document their information.
Given the dynamic nature of customer data, credit institutions must ensure regular updates or modifications as necessary. BaFin highlighted that in the case of politically exposed persons, enhanced duties of care are warranted, necessitating additional information to adequately address the heightened risks associated with these business relationships.
In light of BaFin’s actions, the bank spokesperson affirmed that the institution maintained ongoing communication with the relevant authorities and complied with BaFin’s stipulations.
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