Volksbank Faces Scrutiny by Dutch Central Bank for Money Laundering Violations

Introduction

The Volksbank, the parent company of SNS, ASN Bank, and Regiobank, is currently being investigated by De Nederlandsche Bank (DNB) for violating the anti-money laundering law. According to the DNB, the current policies of Volksbank do not comply with the Law on the Prevention of Money Laundering and Financing of Terrorism (Wwft).

Volksbank’s Mistakes in Anti-Money Laundering Policy

Every bank is required to adhere to a set of security measures, which includes the responsibility to prevent money laundering and terrorist financing. Banks must maintain a strict register of their customers and also investigate suspicious activities, taking necessary action.

However, the Volksbank, according to the DNB, has failed to meet these measures. This information was disclosed in the Volksbank’s semi-annual report. Despite receiving additional funding, the state-managed bank has not been thorough enough in preventing money laundering practices. The bank has been instructed to improve its systematic integrity risk analysis by April 1, 2024.

In addition, the DNB has initiated a procedure to impose an administrative fine on the Volksbank. Similar fines have been imposed on banks such as ING and ABN Amro, resulting in hundreds of millions of euros in penalties. Rabobank, another Dutch bank, is currently facing a criminal case as well.

How a Nationalized Bank Falls into Error

It is remarkable that a fully nationalized bank commits such a violation. The Volksbank, formerly known as SNS bank, has been under the complete control of the state since the financial crisis in 2008. This action was taken to prevent a bankruptcy and to restore proper management for an independent restart.

However, the Volksbank has made mistakes in its money laundering prevention policies, attracting the attention of the DNB. While the bank is managed by the state, its board is not. The bank operates as an independent entity with limited intervention. Minister Kaag recently announced that a decision regarding the sale of the bank will be made this year, but it will have to wait until the money laundering policy is revised.

Tags: anti-money laundering, bank, fine, DNB, violation, Volksbank