Last year money laundering–related penalties, imprisonments, and actions by authorities across the world resulted in one of the highest cumulative penalties of all time at USD 22 billion, across a total of 3,495 reported AML events.
Below are the 6 biggest AML-related fines and payments by amount that were imposed during the year and the organisations responsible for the failings.
1. Danske Bank fined over $2 billion for defrauding investors
In December 2022, the United States Department of Justice (DoJ) settled a long-running probe into Danske Bank, Denmark’s largest bank. As a result of the investigation, Danske Bank agreed to forfeit over USD 2 billion, with USD 1.2 billion going to the DoJ, USD 178.6 million to the Securities and Exchange Commission, and USD 612.4 million to Denmark’s Special Crime Unit.
“Danske Bank lied to U.S. banks about its deficient anti-money laundering systems, inadequate transaction monitoring capabilities, and its high-risk, offshore customer base in order to gain unlawful access to the U.S. financial system.”
~ Kenneth Allen Polite Jr, Assistant Attorney General of the Justice Department’s Criminal Division
Also in December, the United States’ Securities and Exchange Commission (SEC) announced a separate settlement with Danske Bank. The SEC accused the Danish bank of misleading investors over anti-money laundering compliance failures in Estonia. The bank agreed to pay a penalty of USD 413 million to settle the case, however, this sum also includes the previously mentioned payment of USD 178.6 million.
2. Credit Suisse paid EUR 238 million (USD 234 million) to settle investigation
In October, Credit Suisse reached an agreement with a French court to pay EUR 238 million in order to settle a tax fraud and money laundering investigation by French authorities.
Prosecutors said the alleged scheme took place in several countries between 2005 – 2012, causing “fiscal damage” of over 100 million euros to the French state. The total €238 million penalty included €115 million damages to compensate the French government for lost tax revenue.
It was the latest in a long list of fraud and AML-related investigations into Credit Suisse that go back all the way to 1986.
3. Santander Bank UK paid GBP 107.7 million (USD 132 million) to the FCA
In December, the UK’s Financial Conduct Authority (FCA) fined Santander Bank GBP 107.7 million for repeated anti-money laundering compliance failures. These include inadequate systems and processes for the verification of customer information regarding the banking business that they would be carrying out.
The FCA also highlighted Santander’s failure “to properly monitor the initial amount declared by the customers with the actual turnover of the client.”
“Santander’s poor management of their anti-money laundering systems and their inadequate attempts to address the problems created a prolonged and severe risk of money laundering and financial crime.”
~ Mark Steward, FCA Executive Director of Enforcement and Market Oversight
4. USAA FSB Bank fined USD 140m by FinCEN
Civil money penalty for wilfully failing to implement and maintain an AML program that met the minimum requirements of the BSA from 2016 to 2021.
The Financial Crimes Enforcement Network (FinCEN) levied USAA Federal Savings Bank (USAA FSB) with a USD 140 million fine in March “for willful violations of the Bank Secrecy Act (BSA) and its implementing regulations.”
In particular, USAA FSB admitted that it intentionally failed to implement and manage an appropriate anti-money laundering program.
5. Sydney’s The Star Casino fined AUS$ 100m (USD 62 million) with license suspended
In what is a record fine for an Australian operator, regulators fined Sydney’s The Star Casino 100 million Australian dollars (AUD) for failing to prevent money laundering activity from taking place on the casino’s premises. It was the maximum fine possible. The Star also lost its license as a result of the regulatory investigation. This fine comes on the back of increased pressure on the wider Australian casino industry due to reports of financial crime.
“The institutional arrogance of this company has been breathtaking.”
~ Philip Crawford, Chief Commissioner of the NSW Independent Casino Commission (NICC)
6. A USD 55 million fine for Pakistan’s National Bank
US regulators fined the National Bank of Pakistan (NBP) USD 55 million for repeated compliance failures and violations regarding the bank’s anti-money laundering program. These include inadequate internal controls and risk management failures. The USD 55 million total is made up of two penalties, which were announced in conjunction: One, the Federal Reserve levied a penalty of USD 20.4 million, and two, the New York State Department of Financial Services (NYDFS) issued a fine of USD 35 million.
According to the Federal Reserve, the NBP “did not maintain an effective risk management programme or controls sufficient to comply with anti-money laundering laws”. The NYDFS said, “The National Bank of Pakistan allowed serious compliance deficiencies in its New York branch to persist for years despite repeated regulatory warnings.”
Other notable AML-related fines
2022 also saw regulators take increasing action against Virtual Asset Service Providers (VASPs), otherwise known as the crypto sector.
Several penalties were imposed on crypto exchanges for AML violations, such as a USD 53 million fine for the crypto trading platform Bittrex and a USD 30 million fine for the financial services company Robinhood.
While the first few weeks of 2023 saw the crypto exchange Coinbase having to pay a USD 50 million fine and an additional USD 50 million to improve its AML programme.
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