KYC at center of ING fines for AML/CTF failures


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ING promises to boost AML Compliance, KYC practices after massive fine

ING, the Dutch banking giant, was hit with another major money-laundering fine, Dutch financial-crimes prosecutors announced recently. Reuters reports that ING will pay €775 million (US $900 million) for what prosecutors describe as the banking group not preventing terrorist financing or money laundering “structurally and for years.”

The violations at issue in this settlement occurred during the period from 2010 to 2016. ING paid hundreds of millions in 2012 to settle charges that it violated U.S. law by facilitating payments for clients in Iran and Cuba—payments transferred through the U.S. banking system in violation of sanctions regulations.

Central to the allegations by Dutch authorities is that ING “for years failed to adequately implement a law aimed at preventing money laundering and the financing of terrorism by not carrying out adequate background checks on clients and not sufficiently investigating suspicious transactions,” according to a New York Times report.

“We are taking a number of robust measures to strengthen our compliance risk management and support a strong risk culture and will be making further improvements to ensure we can play a full role in contributing to protecting the integrity of the financial system,” Vincent van den Boogert, CEO of ING in the Netherlands, said in a statement.

A part of those actions, according to ING’s statement about the matter, is taking action against senior-level employees who had a responsibility to oversee and initiate AML Compliance measures.

ING’s statement goes on to acknowledge the following failures: “The identified broader shortcomings include: CDD files missing or being incomplete, assignment of incorrect risk classifications, the failure to have the (periodic) CDD review process in order, failure to exit business relationships in a timely manner, insufficient functioning of the post-transaction monitoring system, classifying clients in the wrong segments and insufficient availability of qualitative and quantitative human resources.”

ING also described how it will improve its processes and oversight in order to improve its KYC, its overall risk mitigation, its culture of compliance, and its active involvement with Dutch authorities’ efforts to stop financial crime.

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