ING fined €775m for failing to spot financial crime

Dutch bank ING has agreed to pay €775m in fines after admitting errors in its policies to stop financial crime.

Financial crime prosecutors said ING had violated laws on preventing money laundering and financing terrorism “structurally and for years”. They claim ING did not properly vet the beneficial owners of client accounts and didn’t notice unusual transactions through them.

As a result, the bank has admitted to ‘serious shortcomings’ in the execution of customer due diligence policies to prevent financial economic crime between 2010 and 2016. It said it ‘sincerely regrets’ that these shortcomings enabled customers to misuse accounts of ING Netherlands.

“As a bank we have the obligation to ensure that our operations meet the highest standards, especially where it comes to preventing criminals from misusing the financial system. Not meeting those standards is unacceptable and ING takes full responsibility,” said Ralph Hamers, CEO of ING.

ING has now entered into a settlement agreement with the Dutch Public Prosecution Service (DPPS) relating to previously disclosed investigations regarding various requirements for client on-boarding and the prevention of money laundering and corrupt practices.

Under the terms of the agreement the bank has agreed to pay a fine of €675m and another €100m for disgorgement, to make up for not spending enough on staffing in the six-year period.

Dutch authorities said they found no evidence that any ING staff had helped customers who may have used banking services for potential criminal activities. It ruled that the errors were not down to individuals, but more the fault of “collective shortcomings at all responsible management levels”.

However, ING said it has started measures against a number of former senior employees, including holding back some of their financial packages.

“We take this very seriously. We are taking a number of robust measures to strengthen our compliance risk management and support a strong risk culture and will be making further improvements to ensure we can play a full role in contributing to protecting the integrity of the financial system,” added Vincent van den Boogert, CEO of ING in the Netherlands.

Copyright © 2018 RegTech Analyst

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