ING reaches settlement agreement with Dutch authorities on regulatory issues in the ING Netherlands business
04 Septiembre 2018 - 12:00AM
- Settlement agreement with Dutch Public Prosecution Service; ING
agrees to pay a fine of €675 million and €100 million for
disgorgement;
- ING acknowledges serious shortcomings in the execution of
customer due diligence policies to prevent financial economic crime
at ING Netherlands in the period investigated (2010-2016);
- ING sincerely regrets that these shortcomings enabled customers
to misuse accounts of ING Netherlands;
- ING has initiated measures against a number of (former) senior
employees with broader responsibility for the safeguarding and
execution of FEC CDD policies and procedures in ING Netherlands,
including holdbacks of variable remuneration and suspension of
duties;
- ING Netherlands has taken various steps to enhance its
compliance risk management and will further strengthen its
compliance culture and awareness;
- ING is committed to conducting its business with integrity,
which includes compliance with applicable laws, regulations and
standards in each of the markets and jurisdictions in which it
operates;
- US Securities and Exchange Commission expected not to take
further actions.
ING announced today that it has entered into a settlement
agreement with the Dutch Public Prosecution Service (DPPS) relating
to previously disclosed investigations regarding various
requirements for client on-boarding and the prevention of money
laundering and corrupt practices. Under the terms of the agreement
ING has agreed to pay a fine of €675 million and €100 million for
disgorgement.
ING has fully cooperated with the DPPS investigation. It has
also undertaken an internal investigation, the results of which
have been shared with the Dutch Central Bank (DNB). The
investigations established serious shortcomings in the execution of
policies to prevent financial economic crime (FEC) at ING
Netherlands in the period investigated (2010-2016). 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.
During the period investigated the execution of ING Netherlands'
FEC policies resulted in the termination of ING's relationship with
thousands of clients. Nevertheless the shortcomings identified
resulted in clients having been able to use their bank accounts
for, inter alia, money laundering practices for a number of
years.
ING sincerely regrets that as a result of the above shortcomings
ING Netherlands did not adequately fulfil its role as gatekeeper to
the financial system, helping fight financial crime. "As a bank we
have the obligation to ensure that our operations meet the highest
standards, especially where it comes to preventing criminals from
misusing the financial system. Not meeting those standards is
unacceptable and ING takes full responsibility," said Ralph Hamers,
CEO of ING.
"We take this very seriously. 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," said Vincent van den Boogert,
CEO of ING in the Netherlands.
In the investigations no evidence or indications were found of
(former) employees having actively cooperated with clients who used
or may have used banking services for potential criminal activities
nor indications of (former) employees having received personal
gains. The identified shortcomings that occurred in the period
investigated are not attributable to some individual persons but
rather collective shortcomings at all responsible management
levels, i.e. business, compliance and control functions.
ING has initiated measures against a number of (former)
employees in senior management positions who had a broader
responsibility for the safeguarding and execution of FEC CDD
policies and procedures in the Netherlands. These measures include
holdbacks of variable remuneration and suspension of duties. In the
context of today's announcement the members of the Executive Board
of ING Group, in consultation with the Supervisory Board, find it
appropriate to forego their variable remuneration over 2018.
ING is committed to conducting its business with integrity,
which includes compliance with applicable laws, regulations and
standards in each of the markets and jurisdictions in which it
operates. Meeting the highest standards wherever we do business is
an ongoing effort. ING has started various initiatives at ING
Netherlands to further strengthen its compliance risk
management:
- An enhancement programme to ensure compliance with 'know your
customer' (KYC) and 'client activity monitoring' requirements. This
includes enhancing management of customer information and improving
effectiveness of the control framework applicable to the FEC
domain, especially with respect to client activity monitoring
capabilities.
- Centralising and simplifying operational KYC activities into
one 'KYC Centre' across divisions, introducing standard processes
and tooling, allowing ING Netherlands to manage these activities
more effectively.
- Set-up Client Risk Committees across business units, deciding
on client on-boarding and exit escalations to ensure KYC risk
mitigation.
- An engagement programme to strengthen the internal compliance
culture and awareness by better enabling employees to act in both
the letter and the spirit of the law, empowered by their
organisation and supported (and enforced) by compliance
departments.
- Active involvement in and contribution to the taskforce
FEC-RAAD, where Dutch authorities that have supervisory, control,
prosecution or investigation tasks cooperate with financial sector
actors to strengthen the integrity of the sector. It does this by
taking preventive action to identify and combat threats to this
integrity. ING also joined forces with DNB and the Dutch Banking
Association (NVB) to harmonise efforts and knowledge in the fight
against financial crime and actively participates in various
taskforces and project teams in this field.
As part of the settlement announced today, ING has agreed to pay
a fine of €675 million and €100 million for disgorgement. In
determining the amount of the fine, the DPPS has taken into account
the financial strength of ING ('ability to pay'). Next to that, the
amount reflects the seriousness, extent and duration of the
identified shortcomings but also expresses the fact that it was not
possible to determine to which extent and for what amounts bank
accounts at ING Netherlands were actually misused. The disgorgement
amount represents the underspend by ING Netherlands over the period
in scope on staffing for implementation and execution of FEC CDD
policies and procedures. These amounts will have a combined impact
on ING Group's third quarter 2018 net result of €775 million, to be
recorded as a special item. The settlement announced today does not
affect the strength of ING, the execution of our strategy nor our
commitment to our customers, shareholders and other
stakeholders.
As previously noted, in connection with the investigations ING
has also received information requests from the US Securities and
Exchange Commission (SEC). ING has been cooperating with these
requests. Based on the settlement agreement announced today, ING
expects that this matter will also be resolved with the SEC without
further payment or the imposition of further conditions.
Note for editors Ralph Hamers (CEO of ING) will discuss
the announcements made today in a media conference call on
4 September 2018 at 10:00 a.m. CET. Journalists can join the
conference call via the Q&A-mode at
+31 20 531 5871 or via live audio webcast at
www.ing.com.
For further information on ING, please visit www.ing.com.
Frequent news updates can be found in the Newsroom or via the
@ING_news Twitter feed. Photos of ING operations, buildings and its
executives are available for download at Flickr. Footage (B-roll)
of ING is available via ing.yourmediakit.com or can be requested by
emailing info@yourmediakit.com. ING presentations are available at
SlideShare.
Press
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Raymond Vermeulen |
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ING Group Investor
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+31 20 576 6369 |
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+31 20 576 6396 |
Raymond.Vermeulen@ing.com |
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