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After downplaying the risks of unregulated crypto-currencies earlier this year, the Dutch bank ABN Amro NV is facing a major money-laundering scandal.
On Sept. 26, Bloomberg announced the news of a criminal investigation into the bank's alleged failures to report suspicious transactions and to properly monitor its customers. ABN AMRO – which remains more than 50% owned by the government after a costly bailout – saw its shares fall by as much as 10.3% in trading in Amsterdam.
This is the highest dip since June 2016, with the Bank's additional Tier 1 bonds falling the most in six months, as Bloomberg notes.
Investigation under money laundering and anti-money laundering laws
The Dutch public prosecutor's office further revealed that not only was ABN AMRO under review for alleged compliance failures, but that it was also under investigation under Netherlands anti-trust laws. money laundering and terrorist financing. The exact details of the investigation were not disclosed.
Following a warning from the central bank of the Netherlands, ABN AMRO announced last July the need for greater vigilance vis-à-vis its 5 million private customers.
It has spent 220 million euros to strengthen its procedures in the areas of personal banking, credit cards and loans to small businesses. It has established a provision of 114 million euros for checks in the second quarter, as well as 85 million euros in 2018. The bank had indicated that it could be subject to sanctions . the authorities but indicated that it could not prepare for a possible fine, the amount of which could not be estimated at that time.
As reported by the Financial Times, ABN AMRO has also tripled its workforce, rising to more than 1,400 people in areas such as compliance, financial crime and the fight against money laundering.
The situation is jeopardizing the Dutch government's commitment to sell its 56% stake in the bank over time. Uncertainty is compounded by the announcement of the departure of General Manager Kees van Dijkhuizen at the end of his term in April 2020.
Last year, his rival, the ING group, the ABN AMRO group, paid a record fine for his "serious failures" in the prevention of financial crime, facilitating money laundering by his accounts for years.
Banks under supervision
The ABN AMRO crisis comes just after a scandal involving the Danske Bank unit in Estonia, whose former leader was found dead earlier this week. He had witnessed – although not suspicious – in the context of a major money laundering investigation conducted in the unit.
Also this week, law enforcement officials raided the premises of Deutsche Bank AG as part of the Danske Bank scandal.
ABN AMRO's senior press officer revealed in May that the bank would stop embarking on a Bitcoin-dependent portfolio (BTC), after concluding that "cryptocurrencies, because of their unregulated nature , are assets too risky for our customers. "
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