Deutsche Bank’s management board agreed to take a financial hit after criticism from regulators of widespread use of private communication channels among staff via applications such as WhatsApp.
The lender is one among several other financial firms under investigation by U.S. authorities over the use of private messaging that can’t be archived. It recently introduced a new app that allows the retrieval of messages on company phones, Bloomberg has reported. Board members are set to see next year’s bonuses cut by 75,000 euros apiece, one of the people said.
A spokesman for Deutsche Bank declined to comment. The regulatory scrutiny had added to compliance headaches that have built up for Deutsche Bank Chief Executive Officer Christian Sewing, who has spent billions of dollars trying to fix the bank’s controls and improve relations with supervisors since assuming his role four years ago. While the CEO has drawn a line under several big litigation risks, new issues have continued to arise.
Sewing himself has used WhatsApp in the past to communicate on issues related to the lender. At one point, he swapped messages with a German businessman, Daniel Wruck, whose role in business deals involving Deutsche Bank and its investment arm DWS has been probed by German investigators, Bloomberg has reported.
The German lender has also begun rolling out a new technical solution that improves oversight of communications through private channels by recording and archiving conversations, one person previously said. The pilot program kicked off in late April and the software has been installed on the devices of 1,750 client-facing staff in the U.S., the person said at the time.