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Police vehicles parked in front of Deutsche Bank headquarters in Frankfurt, Germany, on Nov. 29, 2018.

KAI PFAFFENBACH/Reuters

Police have searched the offices of all the members of Deutsche Bank’s board as part of an investigation into money laundering allegations linked to the Panama Papers, a source told Reuters on Friday.

Shares in Germany’s largest bank ended 2.9 per cent lower, after hitting a record low earlier in the day, as a raid that began on Thursday at the bank’s towering Frankfurt headquarters extended into a second day.

“We will of course continue to actively support the investigation and work constructively with the authorities,” Karl von Rohr, Deutsche’s co-deputy chief executive officer, said in a statement on Friday evening.

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Deutsche Bank shares have lost around half of their value this year, after the bank endured three years of losses and a series of financial and regulatory scandals. The company is now worth only around 17 billion euros ($19.3 billion).

The raid comes as Deutsche Bank tries to repair its tattered reputation.

Christian Sewing, appointed chief executive in April to help the bank rebuild, has trimmed the group’s U.S. operations and reshuffled its management board, but revenue has continued to slip.

Investigators are looking into the activities of two unnamed Deutsche Bank employees alleged to have helped clients set up offshore firms to launder money, the prosecutor’s office has said. The inquiries focus on events from 2013 to this year.

Gerhard Schick, a member of parliament for the opposition Green party, said it was “particularly irritating” that the bank’s current board members oversaw operations during the time in question. “This is not about legacy issues,” he said in a statement to Reuters.

BOARD MEETING

This week’s events raise the stakes of a regularly scheduled meeting of the bank’s supervisory board planned for Dec. 4.

The prosecutor said on Thursday the investigation had been triggered after investigators reviewed information in the Panama Papers, consisting of millions of documents from Panamanian law firm Mossack Fonseca leaked to the media in April 2016.

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Around 170 police officers, prosecutors and tax inspectors began the raid on Thursday, seizing written and electronic documents. Only one police car was visible outside the bank’s headquarters early on Friday.

The head of the Frankfurt prosecutor’s office, Albrecht Schreiber, said on Friday evening that investigators had made “very rapid and very good progress.” Deutsche was co-operating fully, he said, adding that authorities’ queries were answered “without reservation.”

Deutsche Bank’s controls that aim to prevent money laundering have caught the attention of regulators on both sides of the Atlantic.

Schick, who is also chairman of Finanzwende, a grassroots financial watchdog initiative, pointed the finger at Germany’s financial market regulator, BaFin.

BaFin said its critics had misunderstood the situation, and that supervisors and prosecutors played different roles.

In January, BaFin president Felix Hufeld said the agency had found no evidence of substantial breaches of money laundering rules by the banks named in the Panama Papers.

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In September, BaFin ordered Deutsche Bank to do more to prevent money laundering and “terrorist financing,” and appointed KPMG as third party to assess progress.

On Thursday, as the raids were going on, the vice chairman of supervision for the U.S. Federal Reserve, Randal Quarles, met Deutsche Bank management for an unrelated and previously scheduled appointment at the bank’s headquarters, a spokesman for the Fed said.

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