ABN Amro ordered to check existing clients for money laundering

ABN Amro World HQ
ABN Amro world headquarters in Amsterdam. December 7, 2006 (photo: Alix Guillard / Flickr). (ABN Amro world headquarters in Amsterdam. December 7, 2006 (photo: Alix Guillard / Flickr))

Dutch central bank DNB ordered ABN Amro to review all its existing retail clients in the fight against financial crimes like money laundering, CEO Kees van Dijkhuizen revealed in a statement released with the bank's second quarter report. ABN Amro made 114 million euros available for this review of existing clients, the CEO said.

Earlier this year, the bank suddenly announced that it is stepping up the fight against money laundering. ABN Amro pushed 85 million euros into getting its client files in order. Over a thousand people are currently working on this, and that number will be "substantially" increased in the coming years, Van Dijkhuizen said.

It is unclear whether this new review was prompted by the DNB finding shortcomings, or whether the bank is facing imminent fines. Van Dijkhuizen said: "In general, across the bank we will take all remedial actions necessary to ensure full compliance with legislation. Sanctions, such as an instruction, fines, may be imposed by the authorities."

The bank posted a Q2 profit of 693 million euro. The one percent increase over last year’s result was due in part to cutbacks in expenses and a boost in revenue, including the sale of a majority stake in mortgage services firm Stater to Infosys.The CEO said the quarterly profit also reflected the 114 million euro allocation to bolster its ability to investigate current and potential retail clients to comply with the central bank’s demand.

Dutch banks and regulators are increasingly focused on fighting money laundering, partly prompted by major fines. Last year ING had to pay a settlement of 775 million euros and Rabobank was fined 1 million euros for not having their client files in order. Important information was missing from the files, such as where assets came from or what the structure of a company looked like. Without this information, the banks couldn't be sure they're not facilitating criminal cash flows.

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