The Financial Sector Supervisory Commission (CSSF) announced in a that it had imposed an administrative penalty on the credit institution BGL BNP Paribas S.A. for non-compliance with professional obligations related to anti-money laundering / counter financing of terrorism (AML/CFT). The €3m fine was imposed on 8 May 2024 and came after the CSSF carried out an inspection  between May and November 2021. The inspection covered AML/CFT and internal governance frameworks “in relation with a limited number of files belonging to a group of related clients.”

The CSSF noted in its communiqué that it had “taken into consideration the fact that the credit institution not only fully cooperated with the CSSF throughout the investigation but also reacted by putting in place a general action plan and initiated corrective measures during and after the inspection in order to remedy the breaches found.”

Details of the breaches

The regulator identified “severe breaches” related to AML/CFT professional obligations and provided details in its press release. These include:

--”The implementation of enhanced due diligence related to the source of funds and source of wealth of the clients being part of the relevant group of related clients, presenting a higher risk of money laundering and terrorist financing, was deficient and did not provide the credit institution with complete, consistent and duly documented information.”

--“The ongoing due diligence applied to the monitoring of transactions in respect of the group of related clients presenting a higher risk of money laundering and terrorist financing was deficient and therefore did not enable the credit institution to identify unusual or suspicious transactions, in particular when these transactions were not in line with the expected transactions on the accounts.”

--“The credit institution’s lack of vigilance with regard to the group of related clients, of which certain clients were subject to adverse press articles, prevented it from informing promptly the Cellule de Renseignement Financier on its own initiative of suspicious activities and/or transactions.”

--“In addition, by closing certain business relationships being part of the relevant group of related clients (and thus transferring their assets outside the credit institution), despite having sufficient indicia, which as such generated suspicions of money laundering, without first informing the Cellule de Renseignement Financier, the credit institution failed to comply” with the AML/CFT law.

--“The communication with the customer by a limited number of employees that a blocking was in place further to the instruction of the Cellule de Renseignement Financier, without the customer having sought himself to obtain information” constituted a breach of the law.

--“The credit institution’s internal organisation regarding the validation and/or maintaining of business relationships with a limited number of files belonging to a group of related clients who present a higher risk of money laundering and terrorist financing was deficient and did not allow sufficient involvement of the credit institution's responsible persons for AML/CFT matters.”

Remediation measures implemented

Delano contacted BGL BNP Paribas for comment. In response, BGL BNP Paribas said in a written statement: “On 8 July 2024, the Commission de Surveillance du Secteur Financier (CSSF) announced its decision to impose an administrative fine of €3m on BGL BNP Paribas. This administrative fine was issued following an inspection carried out by the CSSF between May and November 2021 concerning certain aspects of the bank’s AML/CTF (anti-money laundering/countering the financing of terrorism) framework in relation to a limited number of files linked to the same group of clients. The findings made for these specific files mainly concerned the enhanced due diligence process related to source of funds and the monitoring of transactions.”

“BGL BNP Paribas fully cooperated during the investigation and took immediate corrective measures regarding the findings identified by the CSSF. In this context, the bank set up an overall action plan and implemented remediation measures during and after the inspection. BGL BNP Paribas continuously adapts its compliance and control system to the regulatory framework evolution with the aim to efficiently combat money laundering and the financing of terrorism.”

“BGL BNP Paribas is committed to applying the highest standards in terms of compliance.”