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Company ABN Amro [Company Info]
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Date Issue Title
20th Dec 2005 Fraud Investigation Dutch bank fined $80 million by US regulators

Report
U.S. regulators on Monday fined ABN Amro, the Dutch banking heavyweight, $80 million for violating U.S. money-laundering laws.

According to a statement from the Treasury Department and the Federal Reserve, ABN had "unsafe and unsound practices" and "systemic defects" in internal controls at its banks to combat money-laundering.

The penalty, one of the largest fines in U.S. history, is the result of almost a decade of violations that involved billions of dollars in transactions that passed through offices of the bank in New York and Dubai, according to a report in The Wall Street Journal.

The report also said the U.S. Attorney for the Southern District of New York was investigating the matter, sources familiar with the case said.

Violations were "serious, longstanding and systemic," the Treasury Department's financial-crimes-enforcement unit said. Additionally, the U.S. Treasury and the Fed said that ABN participated in transactions that violated U.S. sanctions laws.

With $830 billion in assets and 3,000 branches in 60 countries, Amsterdam-based ABN, is the world's 20th-largest bank. De Nederlandsche Bank, the regulator of Dutch banks, joined the U.S. remedial action, as well as state regulators from New York and Chicago.

Shares of ABN closed the regular session down 14 cents to $26.27.

Statement from the Finance Crimes Enforcement Network (FinCEN) of the US Treasury Department:

Bank supervisory and penalty actions released Monday will require ABN AMRO Bank, N.V. to undertake remedial action in its worldwide banking operations and to pay $80 million in penalties to U.S. federal and state regulators.

The Board of Governors of the Federal Reserve System, the New York State Banking Department, and the Illinois Department of Financial and Professional Regulation announced the issuance, together with De Nederlandsche Bank N.V. (the regulator of Dutch banks), of a consent Cease and Desist Order against ABN AMRO and its branches in New York, New York and Chicago, Illinois.

The Order requires ABN AMRO to make improvements to its global compliance and risk management systems to ensure adequate oversight, effective risk management, and full compliance with applicable U.S. laws and regulations. The Order incorporates and largely supersedes the July 23, 2004 Written Agreement among ABN AMRO, its New York branch, the Federal Reserve Bank of New York, the Federal Reserve Bank of Chicago, the New York State Banking Department, and the Illinois Department of Financial and Professional Regulation.

In addition, the Federal Reserve Board, the Financial Crimes Enforcement Network, the New York State Banking Department, the Illinois Department of Financial and Professional Regulation, and the Treasury Department’s Office of Foreign Assets Control (OFAC) announced the assessment of penalties against ABN AMRO. The agencies have assessed penalties based on findings of unsafe and unsound practices; on findings of systemic defects in ABN AMRO’s internal controls to ensure compliance with U.S. anti-money laundering laws and regulations, which resulted in failures to identify, analyze, and report suspicious activity; and on findings that ABN AMRO participated in transactions that violated U.S. sanctions laws. ABN AMRO is also required to take ongoing measures to ensure compliance with U.S. sanctions laws.

The Federal Reserve Board and OFAC have assessed a penalty in the amount of $40 million, payment of which will satisfy the penalty concurrently assessed by the Financial Crimes Enforcement Network in the amount of $30 million.

In addition, the New York State Banking Department has assessed a monetary payment of $20 million, the Illinois Department of Financial and Professional Regulation has assessed a monetary payment of $15 million, and ABN AMRO will make an additional $5 million voluntary payment to the Illinois Bank Examiners’ Education Foundation.

Other Reports on ABN Amro
Date Issue Company Report
27th Nov 2006 Fraud Investigation ABN Amro ABN Amro makes Vietnam settlement

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