Failure to adhere to anti-money laundering (AML) protocols was the most common banking violation that led to substantial fines being imposed on financial institutions last year according to data in Finbold’s Bank Fines Report 2020.
The data shows that fines for all violations totalled US$14.21 billion in the year, with the US imposing by far the heftiest fines totalling US$11.11 billion or more than 78 per cent of all fines imposed across 12 cases.
Australia imposed the second heftiest fines of US$981 across three cases while Israel ranked third with a fine of US$902.59 million in a single case.
Goldman Sachs faced the most fines, largely for its involvement in the Malaysian 1MDB corruption scandal in which the US department of justice reckons more than US$4.5 billion was diverted from the Malaysian government development company to high ranking officials in Malaysia, Saudi Arabia and the UAE.
Australia’s Westpac bank negotiated to pay a $1.3 billion Australian dollars (A$1.3 billion – US$911 million) fine for the nation’s biggest breach of money laundering laws when it failed to adequately report over 19 million international transactions.
Baltic and Cypriot connections
Sweden’s Swedbank was fined SEK4 billion Swedish krona (SEK4 billion – US$425 million) for serious deficiencies in its management of the risk of money laundering in its Baltic operations. Swedish lender SEB Bank was fined SEK1 billion (US$107.11 million) for failures in compliance and governance in relation to its AML regulations in the Baltics.
Deutsche Bank agreed to pay US$150 million in penalties in the US for significant compliance failures in connection with the bank’s relationship with Jeffrey Epstein and correspondent banking relationships with Danske Bank Estonia and FBME Bank, the now defunct international commercial bank that operated mainly out of Cyprus.
Finbold’s Bank Fines Report 2020 can be found here.
Categories: Trade Based Financial crimes News