BOX 6.10 (continued) accounts of ING customers were used to launder hundreds of millions of euros, and the bank did nothing to prevent it. The investigation by the Fiscal Information and Investigation Service (FIOD) started at the beginning of 2016 after several criminal investigations revealed that suspected companies or persons held accounts with ING in the Netherlands. These findings suggested that the bank’s customer due diligence and monitoring of accounts were insufficient and that unusual transactions were not reported or were reported too late. De Nederlandsche Bank (DNB), the Dutch central bank, had warned ING several times and taken formal measures. ING was aware of shortcomings in its implementation of the policy from 2010 onward, but did not remedy them sufficiently. Improvement programs were undertaken, but were implemented insufficiently. For example, ING solved incidental issues, but did not recognize or sufficiently address structural problems in the transaction monitoring system. In consultation with DNB and the FIOD, the Public Prosecution Service decided to bring criminal proceedings against the bank.
The interests of law enforcement authorities sometimes differ from those of the supervisory authorities, in that the former value the deterrent effect of closing down an institution, while the latter are concerned with maintaining financial stability. A compromise is often found by removing or discharging officers of the institution or imposing a large fine, while at the same time rehabilitating the institution with new owners and management under the watchful eye of the supervisor.
APPEAL The system of sanctions must be consistent with the legal guarantees of an accused person’s right to a defense. The institution must be able to make its observations known to the supervisor and must have the right to lodge an appeal before a competent authority or jurisdiction. The appeal system itself depends on a given jurisdiction’s constitutional arrangements, but some supervisors can set up specialized administrative appeal boards to expedite the process, as judicial processes can take a long time, even if the defendant has access to the courts for final determination. In the United States, for example, three levels of jurisdictions deal with appeals: the Federal District Court in the area where the bank is located; the Federal Circuit Court; and, in the last resort, the US Supreme Court. In France, the Council of State is the only authority empowered to examine appeals against the ACPR’s rulings. In Sweden, appeals can be made to the County Administrative Board, the Administrative Court of Appeal, and finally the Supreme Administrative Court, depending on the sanction chosen by the inspection authority, the Finansinspektionen.
142
PREVENTING MONEY LAUNDERING AND TERRORIST FINANCING
