The Dutch Banking Association (NVB) has presented the European Union with a plan containing fifteen action points for an EU-wide control on money laundering and financial fraud. The plan includes proposals for a new, central EU regulation, a European supervisor to prevent money laundering, and an EU-wide Financial Intelligence Unit.
The presentation of the Dutch banks' plan coincides roughly with new fines imposed by the Dutch Central Bank on Dutch banks because their controls are not yet in order.
Earlier this year, it became known that Rabobank was fined over 1 million euros because the bank's system for monitoring customers for money laundering was insufficiently effective through 2016. As a result, important information about customers could be missing, and the bank did not always know who owned a company, for example.
If a customer file falls into the lowest risk category, a bank generally does not need to review it further. Customers in the middle risk category must be reassessed every three years, and customers in the highest category must be reviewed annually by the bank.
If customers work in sectors with increased risk – such as car trading or real estate – they cannot be placed in the lowest category. The same applies to individuals who also hold accounts in high-risk countries like Malta, Russia, or Angola.
According to the Rabobank spokesperson, the processes within the bank are now in order, but it is now necessary to process all files according to these procedures. It is unclear whether the bank will meet the April 2020 deadline.
Within the EU, the Netherlands is a frontrunner with the banks' plan to jointly monitor payment transactions. The NVB believes EU legislation should explicitly allow this cooperation among gatekeepers, which would improve the fight against money laundering.
Chris Buijink, chairman of the Dutch Banking Association, said in a press release: “We believe that the current inadequate approach to combating financial crime also requires a strong European response. Financial crime is a cross-border problem that requires cross-border solutions, both at the European and global levels.”