(Bloomberg) -- The Justice Department has told Deutsche Bank AG that it may have violated a criminal settlement by failing to inform prosecutors about an internal complaint tied to lender’s asset-management arm, according to person familiar with the matter.
The potential breach involves a deferred prosecution agreement reached in January between the Justice Department and Deutsche Bank in which the German lender agreed to pay more than $130 million to settle charges that it bribed foreign officials and manipulated the market for precious-metals futures. As part of that accord, the bank vowed to cooperate with investigations and make certain disclosures about allegations of misconduct.
The internal complaint came from Desiree Fixler, the former head of sustainability at DWS Group. In March, she alleged the firm had overstated its commitments to environmental, social and government criteria. U.S. prosecutors learned of her complaint after it was made public in August by the Wall Street Journal, which was also first to report the Justice Department notification.
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No final decision on whether Deutsche Bank breached the deal has been made, said the person who asked not to be named because the communications between the U.S. government and the bank aren’t public. The department could end its query without taking further action.
Spokesmen for Deutsche Bank and the Justice Department declined to comment.
In recent months, Justice Department leaders have said they’re reviewing several non-prosecution and deferred prosecution agreements for evidence that companies haven’t been taking their obligations seriously.
The Deutsche Bank agreement requires notification and allows for the bank to respond to any allegations. The Justice Department’s warning could lead to the bank reaching a new settlement with the department. If prosecutors were to move forward, the earlier deal would be voided and criminal charges could be filed in court.
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