ABN Amro fined €1.1m for lax money laundering protection in Dubai

no image
No image availableNL Times

ABN Amro announced today that investigations around its Private Banking office in Dubai have been completed, and the company is to pay around 1.1 million euros in fines due to  shortcomings of its money laundering protection procedures and controls.

De Nederlandsche Bank (DNB) and the Dubai Financial Services Authorities (DFSA) observed shortcoming in the client acceptance and risk management process at the private banking branch in Dubai. Shortcomings included: identification of ultimate beneficial owners, insight into client structures, establishing source of wealth, and adequate transaction monitoring, reported the banks website.

The DBN has imposed a fine of 625,000 euros and the DFSA has imposed a fine of $640,000 (around 585,000 euros).

Insufficient control was also noted by the DFSA in the banks Head Office’s oversight of the Dubai branch. The DFSA also concluded that ABN Amro contravened a number of the Authorities specific rules.

The Financieel Dagblad reported that suspect customers deliberately opened an account at the private bank to escape strict supervision. Most of the fraudulent customers are reported to have come from India by way of the banks subsidiaries.

ANM Amro has released statements saying that it sincerely regrets these irregularities and  that they will not be appealing the fines.

The two whistle blowers that brought the situation to light have revealed staff members that are not adhering to the internal rules and regulations. Nine employees' employment contracts have been terminated.

The bank has launched a remedial programme and has pro-actively terminated relations with about 80 clients and a number of their intermediaries. ABN Amro expects to have the review completed by the end of the year and has taken further measures to strengthen its internal governance, in part, by tightening reporting lines and procedures.