ABN Amro has been agreed to pay $574m (€480m) to resolve allegations regarding its non-compliance with the Anti-Money Laundering and Counter Terrorism Financing Act.
The settlement amount of €480m includes a fine of €300m and the remainder as disgorgement.
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The findings follow a probe by the Dutch Public Prosecution Service (DPPS), which found “serious shortcomings” in the bank’s processes to fight money laundering in the Netherlands from 2014 to 2020.
The investigation flagged loopholes in ABN Amro’s client acceptance, transaction monitoring and client exit processes, called the Client Life Cycle processes.
DPPS said that in certain case, clients were able to abuse ABN Amro accounts due to the lapses.
Prosecutors will be investigating whether there is sufficient evidence about their offences to prosecute them.
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By GlobalDataThe bank said that the settlement will affect its Q1 2021 results.
Identifying the issue’s seriousness, the bank admitted that it has lagged behind in its role of gatekeeper to fight money laundering.
The bank also said that it has cooperated with the DPPS during the probe.
Besides, the bank revealed that it had itself already identified loopholes in its Client Life Cycle processes and has prioritised remediation and enhancement programmes to resolve them.
ABN AMRO further said that it decided to centralise the execution of the ‘Client Life Cycle’ processes in October 2018.
It has also launched the Detecting Financial Crime (DFC) programme towards meeting this objective.
Furthermore, the bank said that it has made substantial additional funding resources available for investments in staff, systems and processes.
ABN Amro CEO Robert Swaak said that the bank takes full responsibility for the actions.
Swaak noted: “As a bank we do not merely have a legal, but also a moral duty to do our utmost to protect the financial system against abuse by criminals. In fulfilling this duty, we aim to make a meaningful contribution to a safer society.
“Regretfully, I have to acknowledge that in the past we have been insufficiently successful in properly fulfilling our important role as gatekeeper.”
The probe also identified three former board members of the bank responsible for the breaches.
In 2018, another Dutch bank – ING – was fined €775m for money laundering.
The fine was the result of a probe by DPPS, which found significant flaws in the execution of policies to prevent financial crime at ING Netherlands.
The probe also found several customer due diligence (CDD) files to be incomplete, incorrect risk classifications, inadequate post-transaction monitoring system, and unavailability of a periodic CDD review process.
