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A subsidiary of BNP Paribas has been fined €3 million by Luxembourg’s financial regulator, the CSSF (Commission de Surveillance du Secteur Financier), for multiple failures in adhering to anti-money laundering (AML) regulations. The penalty was levied against BGL BNP Paribas, a Luxembourg-based bank within the BNP Paribas group.
The CSSF imposed the fine due to "non-compliance with anti-money laundering and terrorism financing (“AML/CFT”) professional obligations." The regulator conducted an inspection of the bank between May and November 2021.
“During the Inspection, the CSSF identified severe breaches of AML/CFT professional obligations,” the CSSF reported.
Key issues identified included:
- Enhanced due diligence checks on affluent clients were found to be “deficient and did not provide the credit institution with complete documented information.”
- Monitoring of transactions for clients at higher risk of money laundering and terrorist financing “was deficient.”
- There was a “lack of vigilance regarding the group of related clients, some of whom were subject to adverse press articles.” This lack of vigilance led to BGL BNP Paribas failing to notify CSSF of suspicious activities “of its own initiative.”
- When certain clients moved their assets out of BGL BNP Paribas, “which as such generated suspicions of money laundering,” the bank ended its business relationship with these customers without informing the CSSF first.
- Informing a customer about a blocking order under the CSSF's instructions “without the customer having sought himself to obtain information.”
The CSSF noted that BGL BNP Paribas’s cooperation during the investigation mitigated the breaches to some extent. “[The company] also reacted by implementing a general action plan and initiating corrective measures during and after the inspection to address the breaches found,” the CSSF added.
By fLEXI tEAM
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