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Two banks are facing fines this week, and an EU banking watchdog calls for unified AML rules.
Antonis Melis
September 11, 2020

An EU banking watchdog has suggested that the European Union creates a single set of rules that are binding on member states to better deal with money laundering and terrorist financing.

In other parts of the world, European banks have been fined for violating laws in India and the US, with Standard Charted receiving a fine of £10million and Deutsche Bank paying a minor fine of £454,300.

Find out more on these stories below.

EU banking watchdog calls for single set of anti-money laundering rules

The European Banking Authority (EBA) said strengthening EU laws would plug gaps and tackle divergent national approaches to applying the bloc’s existing rules on money laundering (ML) and terrorist financing (TF).

A directly binding single EU regulation would stop national practices that have had a significant adverse impact on preventing the financial system from being used for ML/TF purposes, the EBA said in a statement.

A unified approach could make it easier for institutions looking to enter new territories comply with regulations, without having to adapt to different laws.

Standard Chartered is fined £10.6 million in India for 2007 deal

India’s anti-money laundering agency fined Standard Chartered Plc 1 billion rupees (£10.6 million) for breaking foreign exchange rules when it worked on the takeover of a local bank, marking one of the country’s biggest penalties imposed on an overseas lender.

An eight-year probe found that Standard Chartered violated the so-called foreign exchange management act — which monitors offshore financial transactions — when it worked with a group of investors to buy a stake in Tamilnad Mercantile Bank Ltd. in 2007, according to an August order from India’s enforcement agency that was seen by Bloomberg.

Both banks have so far been unable to comment.

Deutsche Bank will Pay $583K to Settle Violation of Sanctions

The U.S. Department of Treasury announced on Wednesday that the largest German investment and financial services provider Deutsche Bank has agreed to pay two settlements totalling US$583,100 (£454,300) for facilitating transactions that violated Ukraine-related sanctions.

According to the department’s Office of Foreign Assets Control (OFAC) enforcement release, Deutsche Bank would pay two settlements of $157,500 (£122,700) and $425,600 (£331,600) for each infraction, which some have argued is a negligible amount for a financial institution that has an annual revenue in the tens of billions.

Do marginal fines like these really drive banks to improve their compliance? Only time can tell, but it is likely that more regulations will have to be made as banks are often slow to change.  

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