90% of Europe's biggest banks fined for money laundering offences

Lianna Brinded
·Head of Yahoo Finance UK
Photo: Danske Bank
Photo: Danske Bank

When the boss of Denmark’s biggest lender Danske Bank (DANSKE.CO) resigned over a €200bn (£174.9bn, $321bn) money-laundering scandal, it highlighted how the industry is still grappling with stemming money-laundered cash flowing illegally through their systems.

Highlighting how the problem is widespread, data collated by anti-money laundering experts Fortytwo Data sent to Yahoo Finance UK, at least 18 of the 20 biggest banks in Europe, including five UK institutions, have been fined for offences relating to money laundering within the last 10 years.

The 10 largest banks in Europe have fallen foul of the authorities: France’s BNP Paribas (BNP.PA), Crédit Agricole Group, Société Générale and Groupe BPCE, Germany’s Deutsche Bank (DBK.DE), Spain’s Santander (BNC.L), Dutch bank ING (ING), and Britain’s HSBC (HSBA.L), Barclays (BARC.L), and Lloyds (LLOY.L).

Other banks that made the list include the UK’s RBS (RBS.L) and Standard Chartered (STAN.L), Italy’s Intesa Sanpaolo (ISP.MI), Switzerland’s UBS (UBSG.VX), Credit Suisse (CSGN.VX), Spain’s Banco Bilbao (BBVA.MC), Dutch institution Rabobank (RABO.AS), and Nordea Bank of Sweden (NDA-SEK.ST).

“It is clear Europe’s largest banks are collectively struggling having problems when it comes to anti-money laundering standards. The increasing sophistication of the money launderers makes this an ever more difficult task,” said Julian Dixon, CEO of Fortytwo Data in a statement.

“Money should not be laundered on their watch. However, standards must be maintained. The fact that almost all of Europe’s 20 biggest banks are known to have failed to comply with AML regulations is a troubling finding.

“These days, there are effective solutions to be found. Technology has reached a level where it can vastly improve the efficiency of suspicious activity detection and all major banks have a responsibility to embrace 21st Century solutions to this problem, rather than continuing with outdated legacy systems.”

In September this year, the director of economic and cybercrime at the National Crime Agency (NCA) Donald Toon, said the number of reports the NCA had received from lawyers related to money-laundering offences had dropped by 10%. He added that London is being described as the money-laundering capital of the world. According to the NCA, up to £90bn of illicit funds are laundered through Britain annually.

In an article for Chatham House, Robert Barrington of non-governmental organisation Transparency International said: “The Russian connections to London are particularly interesting due to the current political situation. It may be that the influx of Russian money into Britain is just a case of legitimate Russian business people trying to move their hard-earned money to a safer place than Moscow. There will be some of those.”

“But consider also the case of Igor Shuvalov, Russian first deputy prime minister, who is reported to be the owner, through a Russian company of which he and his wife are shareholders, of an £11.5 million property near the Houses of Parliament in Westminster. Shuvalov declared assets in 2014 of £634,000, when his official annual salary was £112,000.

“There are no firm numbers for how much Russian money is laundered through London, but a couple of indicators suggest that it could be up to a quarter of the total.”