The trio of clients that got Deutsche Bank AG in regulatory trouble this week had a shared back story: They were all castoffs of JPMorgan Chase and Co.
Deutsche Bank moved millions of dollars across the globe for convicted sex offender Jeffrey Epstein in the past decade, and billions on behalf of international lenders Danske Bank A/S and FBME Bank Ltd. Along the way, the German bank missed or disregarded compliance red flags for years, New York’s Department of Financial Services said Tuesday in levying $150 million in penalties.
JPMorgan’s moves to offload those same clients years earlier may have helped it dodge a similar bullet. The biggest U.S. bank stepped away from handling money for FBME in 2009. It distanced from the others around 2013, the same year it undertook a broad purge of higher-risk clients from its correspondent banking business.
The bank had incentive to offload risky clients. JP Morgan’s primary U.S. regulator, the Office of the Comptroller of the Currency, put it on notice in early 2013, faulting its due diligence processes and ordering it to clean up its anti-money laundering controls. Later that year, the bank said it would spend $4 billion to shore up its compliance operations — a process that included reviewing the accounts of hundreds of clients and shedding many of them.
JPMorgan declined to comment.
Deutsche Bank, whose business is regulated in New York, said this week that it has cooperated with authorities and that it regretted bringing Epstein on as a client. Although it acknowledged deficiencies in its oversight of the FBME and Danske relationships, the bank said it found no intentional effort to facilitate unlawful activity. It declined to comment for this article.
Concerns about Danske Bank, Denmark’s biggest bank, centered on its Estonia unit. News organizations including the Organized Crime Corruption and Reporting Project wrote in 2018 that the unit had helped rich Russians move nearly a quarter-trillion dollars from their country over the course of a decade, largely through anonymized shell corporations. The bank acknowledged later that year that many of those transactions should have been flagged as suspicious.
JPMorgan stopped providing the Estonia unit access to the U.S. financial system in 2013, citing the high percentage of client accounts domiciled outside the Baltic country. Deutsche Bank continued providing banking services to Danske for another two years.
The Justice Department is investigating the role played by Danske’s correspondent banks in the U.S., including Deutsche Bank, people familiar with the matter have said, adding that the authorities are also trying to understand JPMorgan’s role.
Deutsche Bank had a decades-long relationship with FBME, which is registered in Tanzania and based in Cyprus. In the 1980s, the small bank was a client of Banker’s Trust, which Deutsche Bank acquired the next decade. By 2005, Deutsche Bank had deemed FBME high on its risk scale, and its monitoring systems were flagging suspicious transactions at a rate of more than twice a week during some years, according to the New York regulator. Although Deutsche Bank admonished FBME at times over its practices and demanded more information about its clients, the German bank continued doing business with it, the regulator said.
JPMorgan started doing business with FBME in the early 2000s and quickly grew frustrated with its failure to fully explain certain transactions, according to documents reviewed by Bloomberg News. The banking giant was also wary of other practices at FBME, such as offering “hold mail” services, in which a bank allows clients to use the bank’s address to limit paper trails, according to those documents.
Deutsche Bank provided banking services to FBME for five years after JPMorgan stopped, processing some $618 billion in all. It ended the relationship in 2014, after the U.S. Treasury labeled FBME a “primary money laundering concern” for its alleged work with organized crime and terror groups, effectively freezing it from the U.S. financial system. FBME has disputed those allegations.
The late Epstein, for his part, was a longtime client of JPMorgan — characterized inside the bank as a “center of influence” who could help it attract lucrative clients. Epstein stayed with the bank well after 2008, when he pleaded guilty in Florida to soliciting minors for prostitution. Epstein moved over to Deutsche Bank in 2013, after a banker who’d recently joined from JPMorgan persuaded executives to bring him aboard, according to the DFS.
Epstein’s legal troubles mounted again in 2018. That November, the Miami Herald published a series of articles cataloging allegations from women who said they had been abused sexually by him as minors. Deutsche Bank notified Epstein in December 2018 that it would be closing his accounts.
After building and selling a billion-dollar makeup empire, it would be easy (and understandable) to pack up and retire.
But cosmetics legend Bobbi Brown is looking to push the industry forward with the launch of a new company meant to disrupt the beauty industry once again. EVOLUTION_18 is a beauty-inspired ingestible line—selling powders, capsules, gummies, and more with collagen and protein—inspired by Brown’s personal credo that beauty starts from the inside out.
Brown recently spoke with Fortune about her new business, EVOLUTION_18, and the explosion of wellness brands taking over the beauty and cosmetics industries.
The following interview has been lightly edited and condensed for clarity.
Fortune: Your original eponymous cosmetics brand grew into a multimillion dollar business, which you sold to Estée Lauder more than 20 years ago. In the last few years, there has been a considerable shift in consumer preferences from makeup to a focus on skincare and wellness. Your new brand, EVOLUTION_18, is more about “ingestible beauty.” What exactly is ingestible beauty, and why do you think consumers are leaning this way and away from traditional makeup and beauty brands?
Brown: It seems that people are recognizing that beauty really does begin from the inside out. Personally, my makeup routine has grown more minimal over time, always involves moisturizer, and rarely takes longer than five minutes. Everyone is different, but usually when you’re taking care of yourself on the inside, the better you look on the outside. And even more importantly, you feel better, stronger, and more confident. I think people are catching on—and skincare and wellness brands are, too.
The wellness industry is hotter than ever, but it’s also crowded. What inspired the launch of EVOLUTION_18? What makes it stand apart?
I launched my lifestyle-inspired wellness line, EVOLUTION_18, as a natural extension of my book Beauty From the Inside Out, which is all about how health enhances beauty. After spending more than 25 years talking to women about their health and wellness challenges, I became a certified health coach with the Institute for Integrative Nutrition. This transition was a great opportunity to pursue something I’ve always been passionate about, and it’s been exciting to bring decades of corporate experience to a start-up. It’s an opportunity to really think outside of the box.
During the past few months with stay at home orders in place, you’ve been building the brand from your home. What has that been like? What has your day-to-day routine been like?
When the lockdown was announced and all my appointments, lunches, and in-person appearances were canceled, I was able to step back and evaluate what really matters.
Now I’m trying to keep everything simple. I’m doing housework between the Instagram lives and Zoom calls. And my team is scrappy and brilliant—they’ve made the transition to working from home easy. Once we’re back in the office, I’m looking to integrate even more flexibility into our culture. If something comes up and someone can’t make a meeting, they can Zoom in. And maybe I’ll be more willing to take that trip with my husband, since I know now that I can take calls and keep the business going from anywhere.
EVOLUTION_18 is available online, direct-to-consumer, but also via Walmart. How did the partnership with Walmart come about?
The partnership with Walmart came from a simple philosophy: health and wellness should be available to absolutely everyone. The products in this line-up, in particular, are even more affordable, and even more accessible to all. Plus, they’re delicious, easy to add into your daily routine, and really work.
Obviously, amid the coronavirus pandemic, consumers’ purchasing habits and practices are going to change. How does EVOLUTION_18 plan to adjust its business plan for the immediate future?
We’re learning how to be more flexible now than ever. EVOLUTION_18 launched two new products during the pandemic—Energizing Chocolate and Relaxing Vanilla—both during the quarantine. Because I was sheltering in place at home, my son Cody filmed me for a Facebook Live on launch day. I couldn’t get the packaging from the manufacturer, so I just used a clear jar with the powder in it. As with any entrepreneurial endeavor, you just make it work.
You’ve had an eventful and successful career in the beauty industry. What advice would you give for first-time business owners and entrepreneurs who are looking to get started in beauty and wellness?
With the rise of clean beauty and a heightened focus on wellness, it’s an exciting time for these industries—but they’re also pretty crowded. It’s important as a new brand to differentiate yourself. As always, don’t spend more than you have. And just do it. You don’t have to overthink it. Try it, and if it doesn’t work, try it differently. Stay flexible, stay open, be nice—and you’ll figure it out.
While public health officials are urging Americans to avoid large crowds and hold more muted Independence Day celebrations amid a spike of coronavirus cases, President Donald Trump is going big for what he is promising will be a “special evening” in the nation’s capital.
Trump is set hold his “Salute for America” celebration Saturday with a speech from the White House South Lawn that he says will celebrate American heritage, a military flyover over Washington, and an enormous fireworks display that is expected to draw thousands to the National Mall.
The celebration comes one day after Trump kicked off the holiday weekend by travelling to Mt. Rushmore for a fireworks display near the iconic mountain carvings George Washington, Thomas Jefferson, Abraham Lincoln and Theodore Roosevelt. The president delivered a fiery speech in which he accused protesters who have pushed for racial justice of engaging in a “merciless campaign to wipe out our history.”
Trump is taking part in the big gatherings even as many communities have decided to scrap fireworks, parades and other holiday traditions to try to prevent further spread of the virus that they fear could spurred by large holiday gatherings.
Still, Trump insisted on moving forward on holding big gatherings–including the Mt. Rushmore event for which South Dakota Gov. Kristi Noem, a Trump ally, insisted social distancing wasn’t necessary and masks were optional. Trump spent little time in his Mt. Rushmore address reflecting on pandemic, which has killed more than 129,000 Americans.
Centers for Disease Control and Prevention cautions that mass gatherings like the one scheduled for Washington present a high risk for spread of the virus.
Trump’s Surgeon General Jerome Adams, who has stepped up his call for Americans to wear a mask in public, on Friday punted when asked during an interview whether he would caution a loved one from attending such large gatherings.
“It’s not a yes or no,” Adams told NBC’s “Today Show.” “Every single person has to make up their own mind. There are people going to beaches, going to barbeques, going to different environments and they are going to have to look at their individual risk.”
Trump has been aching to see the nation return to normalcy, and has been willing to push the envelope further than many state and big city mayors are willing to go.
Last month, he held his first campaign rally since early March in Tulsa, Okla. Trump is accustomed to jam-packed crowds, but the BOK Center was only about a third full for the president’s first rally of the coronavirus era. Days later, he addressed a packed megachurch for a Students for Trump event in Arizona. Few attendees at either event wore masks.
Interior officials said they would hand out 300,000 face coverings to spectators who gather on the National Mall. Interior Department Secretary David Bernhardt said visitors would be encouraged to wear masks and keep a six-foot distance from one another. There was no indication that would be mandatory, despite the recommendations of health officials.
Washington Mayor Muriel Bowser, who said she didn’t have the right to shut down the holiday spectacle because it’s on federal land, warned the federal government about the obvious dangers of such a large crowd. On Friday, she urged the city’s residents to be smart about how they spend the holiday.
“Just because someone invites you to a party doesn’t mean you have to go,” Bowser tweeted Friday.
Elsewhere, governors and local officials pleaded with residents to take precautions as they celebrate the holiday.
In California, which has seen a surge of cases in recent weeks, Gov. Gavin Newsom asked residents not to gather with people they don’t live with and to avoid crowds. Fireworks shows in Los Angeles, San Francisco, Sand Diego and elsewhere in the state were canceled to keep big crowds from forming
“Happy Fourth of July weekend, and wear a mask,” Newsom told his state’s residents.
Illinois Gov. J.B. Pritzker urged businesses and residents to comply with public health measures over the July 4 holiday weekend, warning that precautions were essential to continue to slow the spread of COVID-19.
Pritzker warned he won’t hesitate to close down businesses that don’t abide by capacity requirements, and he encouraged people to avoid large crowds and wear face coverings.
“Letting our guard down now would fly in the face of the progress we’ve made over many months,” Pritzker said.
Some Americans are hoping to make do with their own firework shows.
At Casey’s Fireworks Friday in Columbia, South Carolina, mostly masked shoppers wove through aisles, selecting their own explosives after some annual July Fourth shows were cancelled due to COVID-19.
Health officials there have seen a spike in cases that has the state trailing only Arizona and Florida in the 14-day average of newly diagnosed COVID-19 cases adjusted for population.
The fireworks shop, like many around the country, has been unexpected beneficiary as more Americans have decided to put on their own shows. The spike in sales started around Memorial Day.
“This whole COVID thing has been really bad all around,” said Forest Casey, a fourth-generation fireworks salesman at the family-owned shop. “But for whatever reason it makes people really want to buy fireworks.”
South Carolina has some of the most liberal fireworks laws in the nation. Stands across the state sell pyrotechnic bricks that launch a dozen or more shells with explosions that rival a small town’s annual show.
Some said they are trying to make the best of the situation. Jamie Parrott, a local pediatric neurologist, said he intends to stay at home with his grandchildren, setting off fireworks safely and eating hamburgers.
“We’ll muddle through,” Parrott said.
After weeks of speculation, Apple finally announced that it would be switching its Mac computers to ARM-based Apple silicon processors starting by the end of the year, a big blow to Intel.
Apple CEO Tim Cook made the announcement at the company’s Worldwide Developers Conference (WWDC), noting the previous few transitions, from PowerPC chips to Intel-based chips, were large leaps forward for the Cupertino, Calif.-based tech giant.
“When we look ahead, we see some amazing new products in transitioning Macs to Apple Silicon,” Cook said. “Silicon is at the heart of our hardware.”
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Though initial shipments of Apple Silicon-based Macs will start this year, Cook added the full transition would take about two years. The tech executive also said there are some Intel-based Macs in Apple’s product pipeline.
Apple already uses its own chips in the iPhone and iPad. The iPhone and iPad use Apple chips based on the ARM architecture, which is more suitable for mobile devices.
The move will “bring with it benefits such as longer battery life and cellular connectivity,” Jitesh Ubrani, an analyst at market researcher IDC, recently told Fox News. Those are both hallmarks of the iPhone and iPad.
Apple announced the transition from PowerPC processors, made by IBM and Motorola, to Intel processors back in 2005 at the Worldwide Developers Conference. And that came after a transition to PowerPC years before that.
The transition to Apple’s own chips will boost power performance, according to Johny Srouji, Apple senior vice president of Hardware Technologies. Our plans are to give the Mac a much higher level of performance while reducing the use of power, Srouji said.
The move will also allow developers to more easily build apps for all of Apple’s products, including iPhone and iPad, Srouji added.
In addition to the major announcement, Apple announced updates to its operating systems, iOS, iPadOS, watchOS, tvOS and macOS.
Apple’s senior vice president of Software Engineering Craig Federighi announced the new version of iOS, iOS 14. Some of the new features include an app library that automatically organizes all your apps into one easy view and uses machine learning to suggest what apps you’ll need next.
As part of the new iOS, widgets will get different sizes with more data, including an all-new smart stack that allows you to automatically swipe through the widgets you need just for the moment.
Other updates include picture-in-picture, enhancements to Siri, Memoji (including Memoji with face masks) and Messages, allowing users to follow group conversations easier. A new Translate app, similar to Google Translate, allows Siri to translate voice and test in real-time.
Apple Maps is also being upgraded, getting new dedicated cycling and electric vehicle routing options.
App clips, which Federighi described as a “small part of an app,” will allow users to get what they need at the moment they need without downloading an app, thanks to NFC or QR codes.
Changes to iPadOS include updates to Apple Pencil, new widgets (which will also be available on iOS), redesigned apps, an improved Siri and a redesigned universal search.
Apple’s new macOS, codenamed Big Sur, is getting a redesign and major updates to Messages, Maps, notifications and more, the company said.
As part of the macOS update, Safari will be able to run 50 percent faster than Google Chrome when loading pages and additional privacy enhancements, including the ability to see more detail about the website’s tracking methods.
Apple made several other software-related announcements on Monday, including the ability to automatically switch AirPods between devices and incorporating a surround sound experience on AirPods Pro.
New updates to watchOS include allowing multiple complications in one face, new watch faces and the ability to share watch faces. The redesigned Health app will also incorporate the ability to track sleep and help you create a routine to help you sleep better.
The new watchOS will also have automatic detection for washing hands for 20 seconds, using machine learning to detect the hand-washing motion and using audio to hear running water.
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In its most recent quarterly results, Apple said it generated $5.3 billion in Mac-based revenue.
Fox News’ Brooke Crothers contributed to this story.
The founders of this fashion-forward protective gear detail the birth of their signature product.
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4 min read
In this ongoing series, we are sharing advice, tips and insights from real entrepreneurs who are out there doing business battle on a daily basis. (Answers have been edited and condensed for clarity.)
Who are you and what is your business?
We are Elena Solle, Hazel Solle and Carlton Solle, the founders of G95, Inc. Our gear has built-in filtration technology to help protect you from bacteria, viruses, air pollution, allergens, smoke, PM 2.5 and other airborne particles that can be hazardous to your health.
What was your “aha moment”?
I got sick while on a trip to China several years ago. The doctor I saw said I had either caught something while on the plane or gotten sick from the air pollution. I asked what I could do to protect myself in the future and suggested wearing one of those white masks. My first response was, “One of the masks that make you look like you are sick?” When I got home I spoke with my wife about what happened. She told me how when she was growing up in Costa Rica, she used to play with two hand-me-down dolls and because fabric was scarce, she would make scarfs for the dolls. From that discussion, our first product was born: the Bioscarf.
Related: Real Entrepreneurs: Need a Mental Break? The ‘Meet Cute’ Podcast Delivers Rom-Com Escape in 15-Minute Burst
What does the word “entrepreneur” mean to you?
For us as a family, it’s who we are and who we have always been. For the past 20+ years, one of us or all of us have been starting businesses and or pursuing ideas and inventions. It runs through our veins and is really what keeps us going.
Related: Real Entrepreneurs: Have a Great Product? Don’t Be Afraid to Dismantle It to Build a Better One.
What advice would you give to other entrepreneurs?
The most difficult part of coming up with an idea or concept is that you need to share it to evaluate it and to flesh it out. At the same time, the most dangerous thing when you are an entrepreneur is other people. Some might throw you off course, others might see what you have created and want to try to work their way into it. Others will want to try and crush your idea because they didn’t think of it and others will simply be a time suck which can also send you off course. The trick of the entrepreneurial journey to get to realize your vision and not getting steered off course or losing your drive. You need to stay true to your vision and what you feel in your gut.
Related: Real Entrepreneurs: How to Launch Your Product Without Sinking Your Savings
What trait do you depend on most when making decisions and why is that useful for you?
It’s all about persistence and moving forward. You always hear about young single entrepreneurs who lived out of someone’s garage eating top ramen and then they made it big. So what about when you have a family? When you have rent to pay and school and all the rest of the responsibilities that come with being a bit older? That garage top-ramen thing doesn’t really cut it. So the pressures and sacrifices are much larger and much more extreme and they are not only affecting you but also your whole family. How far are you willing to go? For us, it’s been about persistence, everyone sacrificing for the bigger picture — and sometimes that has come at pretty extreme costs. But you get through them and learn from them.
Is there a particular quote or saying that you use as personal motivation?
There are two quotes that sit above my desk: “The best way to predict the future is to create it.” And “Throw me to the wolves and I will return leading the pack.”
MAMAGREEN recently released the BIG DADDY dining table and it is ready to take on even the most ambitious of your outdoor entertaining endeavors. Crafted from upcycled Indonesian teak, this communal dining table is bound to be the center of attention. Make it your own by customizing BIG DADDY with a variety of sizes, adjustable legs, serving bars, and benches. While it was designed for outdoor use, this beauty would also be welcome indoors at any time and any place.