In January, 2019, I received a tip from someone who worked in a Japanese mountain resort. He told me that an American named Tim Wiswell had arrived on a skiing vacation with his family. Japan, he noted, had signed an extradition treaty with the U.S. My correspondent wrote, “I’m just wondering why it seems he’s not being pursued?”
It was a reasonable question. Wiswell, or “Wiz,” as he was known to his colleagues in finance, was the head of Russian equities at Deutsche Bank in Moscow until 2015. He was also, according to the bank, a key figure behind “mirror trades,” a scheme designed to expatriate and launder money of dubious provenance. In a typical mirror trade, a Russian client of Deutsche Bank would make two simultaneous orders—one to buy stock in Moscow in rubles, the other to sell an identical quantity of the same stock in London, and receive payment in Euros, pounds, or dollars. The client did not make any money on the equities maneuver. The purpose of the double-order was to move money without alerting tax inspectors, sanctions observers, or officers of the law. Between 2011 and 2015, ten billion dollars left Russia through Deutsche Bank’s mirror trades.
When the scheme unravelled, in 2015, Deutsche Bank pointed the finger of blame at Wiswell. The company’s leadership accused him of accepting nearly four million dollars in bribes to facilitate the trades—sometimes through an offshore account owned by his wife, who is an artist—on top of his generous banker’s salary. In 2016, when I investigated mirror trades, a former colleague of Wiswell’s told me that Wiswell had manipulated over-the-counter trades of equities to benefit his friends. A professional money-launderer in Moscow who was intimately acquainted with Deutsche Bank’s capital-flight service told me that, as his fee for making mirror trades, Wiswell sometimes accepted cash payments in a gym bag.
The ultimate beneficiaries of mirror trades were more difficult to discern. Those who wished to move their money commissioned professional launderers, who placed the orders on behalf of front companies. But I was told that the scheme was used both by organized criminals and by politically connected Russians and Chechens. Certainly, mirror trades would have been attractive to anyone eager to circumvent sanctions or the scrutiny of their own government. Bloomberg News named Arkady and Boris Rotenberg, close allies of Vladimir Putin who were sanctioned by the U.S. following Russia’s annexation of Crimea, as users of mirror trades—although no definitive proof has emerged of their involvement. Igor Putin, the President’s cousin, was connected to the scheme.
The recently published FinCEN files detail the extent to which major banks have facilitated money laundering and add some fascinating detail to the mirror-trades affair. The FinCEN documents are based on Suspicious Activity Reports—essentially whistle-blowing reports made by banks themselves—filed to the U.S. government. They were leaked to BuzzFeed News, then shared with the International Consortium of Investigative Journalists, which shared them with news outlets around the world. According to the documents, one of the clients involved in mirror trades was a liaison for Vladislav (Blond) Leontyev, a Russian drug trafficker. (Leontyev denied any involvement in mirror trades or other criminal activity.) Meanwhile, nearly fifty million dollars were also funnelled through mirror trades to the Khanani network, whose clients include associates of Hezbollah and the Taliban.
Deutsche Bank’s reputation was abject even before the mirror-trades scandal broke. Between 2008 and 2016, it paid around nine billion dollars in fines and settlements for a wide range of wrongdoing that included conspiring to rig the price of gold and silver, breaking sanctions in Iran, defrauding mortgage companies, and manipulating the London Interbank Offered Rate, or LIBOR. Recently, the bank was fined a hundred and fifty million dollars by the New York Department of Financial Services for “significant compliance failures” in its relationship with Jeffrey Epstein. The FinCEN files cover around two trillion dollars’ worth of suspicious transactions reported at major banks between 1999 and 2017. Of that two trillion, more than half—around $1.3 trillion—passed through Deutsche Bank.
Deutsche Bank says that it has learned from “historic issues,” and argues that it has “devoted significant resources to strengthening our controls.” The organization has already faced a reckoning of sorts over mirror trades. After the scheme was shut down in 2015, it was investigated by financial regulators in Russia, the U.K., and the U.S. The Russian investigation found that Deutsche Bank had fallen prey to an illegal scheme, and penalized the bank with a token fine of five thousand dollars—pocket change for a senior banker in its Moscow office. Britain’s Financial Conduct Authority and the N.Y.D.F.S. took the bank’s breaches more seriously. They fined Deutsche Bank a combined total of six hundred and thirty million dollars for violating anti-money-laundering laws. The mirror-trades scheme, according to the F.C.A., was “highly suggestive of financial crime.”
As we now know, mirror trades were not just suggestive of financial crime. Major criminal organizations, terrorist groups, and drug cartels used them to launder and transfer money, and benefitted more generally from this geyser of dirty money. A recent internal report at Deutsche Bank noted that the Department of Justice continues to probe the mirror-trades scheme. If so, it is a long-running investigation. In 2016, I exchanged messages with two agents—from the F.B.I. and the U.S. Department of Homeland Security—who had spent half a day in a European embassy questioning one of my sources. But nothing came of their investigation, it seems. Meanwhile, in his recently-published book about Deutsche Bank, “Dark Towers,” David Enrich quotes an F.B.I. agent who said, in 2019, that the investigation into mirror trades was still active. One wonders how active the investigation can be, if it has taken so long. There is also the political environment to consider. Before Donald Trump took office, Deutsche Bank was often the only bank that would lend to him. The chances of criminal prosecutions seem slim, at least during this Administration.
Wiswell’s recent schedule is not indicative of a man worried about arrest. After he was dismissed from the bank in 2015, he fought a wrongful-termination claim against Deutsche Bank in Moscow. (He lost.) Wiswell then moved to Bali, where he ran a Russian-owned surf school, and where he apparently still lives. Last year, he went to Japan, to go skiing, and to Florence, Italy, with his wife, for the art Biennale. She posted a picture of the event on Instagram; Wiswell is holding a glass of champagne. A former Deutsche Bank employee texted me recently to say that he had heard Wiswell had been seen partying on a yacht off the southern coast of France last summer “with some Russians.” (Wiswell did not respond to a request for comment.)
Wiswell was not the only person who facilitated mirror trades. His managers turned a blind eye, either through design or incompetence. All of his immediate superiors still work in finance—although most have moved on from Deutsche Bank. Meanwhile, as BuzzFeed noted in its FinCEN reporting, Deutsche Bank’s own auditing team had investigated the Moscow equities desk in 2014. At that time, mirror trades were flourishing. The investigation gave the desk a clean bill of health, although the team left a blank space for anti-money-laundering controls and so-called know-your-customer procedures—a gross oversight. The chief of Deutsche Bank’s audit division at the time was Christian Sewing, who joined the bank when he was nineteen years old. Sewing is now the C.E.O. of Deutsche Bank.
