Financial supervisor CSSF has issued a fine of 1.56 million euros to the Luxembourg unit of Belgian bank Degroof Petercam after it found the firm to be in “non-compliance with its professional obligations” in regards to anti-money laundering measures.
The fine is the largest on record that CSSF has imposed since its 4.5 million fine for Banque Internationale à Luxembourg, also known as BIL, in August 2020. BIL, known to have many clients from Russia and the former Soviet Union, also was ordered to get its anti-money laundering processes into shape.
Degroof, in a press release, pointed out that the CSSF inspection “did not reveal any illegal acts” but found “certain deficiencies” in the bank’s processes.
CSSF issued its fine on 21 December following an on-site inspection that started in September 2019. The supervisor said it found “ important weaknesses” in the bank’s anti-money laundering and counter terrorism finance framework, “such as a failure to report some suspicions of money laundering, some late reporting of suspicions and deficiencies at the level of the name matching controls.”
Banks are required to verify and control names of account holders against official lists of persons subject to sanctions and other restrictive measures in financial matters, of politically exposed persons, of persons suspected of criminal activities. CSSF said this requirement also applies to persons “exposed to negative press”.
‘Significant changes’
CSSF noted that Degroof since then has taken remedial measures to address the issues discovered and said “significant changes” have been made at the level of the supervisory and management bodies as well as at the level of the control functions.
In its press release, Degroof said that “the bank has strengthened its internal governance and is constantly improving its compliance controls, procedures and tools, including investing in strengthening its compliance and risk teams to maintain high standards of compliance with applicable legal and regulatory requirements.”
CSSF said that in determining its sanction, it took into consideration the “swift reaction” of the bank to put in place remedial actions.
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