The German banking giant Deutsche Bank has agreed to a $7.2 billion settlement in principle with the U.S. Department of Justice over its role in the late-2000s mortgage crisis, the bank said in a statement on Thursday night, heading off what critics said would be a major conflict of interest with one of its big borrowers – President-elect Donald Trump.
“Deutsche Bank AG…has reached a settlement in principle with the Department of Justice in the United States," the bank announced.
The agreement, if finalized, would allow the bank to resolve one of two major legal issues it has faced with the U.S. government, but likely won’t silence critics who continue to call for a special prosecutor to take over the case.
"Despite this settlement, the criminal investigation of Deutsche Bank and culpable individuals must continue – and it should be done by independent counsel,” Sen. Richard Blumenthal (D-Conn.) told ABC News. “Only an independent counsel can investigate and prosecute vigorously and impartially, in light of conflicts of interest created by the enormous debt owed by Donald Trump to the bank.”
“This settlement can hardly be the end of efforts to hold the bank and its leaders accountable for the crimes and harm they caused,” he added.
Earlier this month, the Justice Department rejected calls to appoint a special prosecutor to take over the investigations into alleged wrongdoing by the German bank that has loaned the Trump Organization more than $300 million.
Deutsche Bank has been one of Trump’s most reliable lenders. The German bank has helped finance the renovation of the Trump Old Post Office development in Washington, D.C. – now a hotel – his purchase of the Doral golf course and country club in Florida, as well as the construction of a Trump office building in Chicago.
“The Department has full confidence in its law enforcement professionals and career attorneys to follow the established Department policies and procedures, which are designed to ensure the integrity of all ongoing investigations,” Assistant Attorney General Peter J. Kadzik wrote last week in response to a request from Sen. Blumenthal.
Kadzik called the appointment of a special prosecutor an “authority that has rarely been exercised.”
Blumenthal had asked the DOJ to relinquish their probes to an independent attorney who would not be subject to political forces once Trump takes office.
Deutsche Bank had previously confirmed the settlement talks in public filings, revealing that the Justice Department had initially demanded the bank pay a back-breaking $14 billion to resolve the mortgage fraud case alone.
Thursday's agreement, according to the bank, sees it agree to pay “a civil monetary penalty of US dollar 3.1 billion and to provide US dollar 4.1 billion in consumer relief in the United States.” Blumenthal argued the incoming Trump administration could not be impartial in handling the matter.
“The credibility of this investigation will be completely undermined, and our criminal justice system will be diminished by this obvious conflict of interest,” Blumenthal told ABC News in an exclusive interview last month. “What's needed here is clearly an independent prosecutor, without any connection to an Attorney General who likely will be someone who is a personal confidant and campaign surrogate for Donald Trump."
