Luxembourg: 3 million Euro fine imposed on BGL BNP Paribas for AML fails.

On 8 July 2024, the CSSF informed the public that it had imposed an administrative fine of 3 million Euro against BGL BNP Paribas S.A. for non-compliance with professional obligations related to anti-money laundering / counter financing of terrorist (AML/CFT)  .

• https://www.cssf.lu/wp-content/uploads/S_43_B_BGL_BNP_Paribas_S.A._080524_en.pdf

The administrative fine followed an inspection carried out by the CSSF between May and November 2021 covering certain aspects of the AML/CFT and internal governance frameworks in relation with a limited number of files belonging to a group of related clients.

Details of the breaches

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

1. --”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.”
2. --“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.”
3. --“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.”
4. --“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.
5. --“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.
6. --“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.”

Source

https://www.luxtimes.lu/businessandfinance/luxembourg-s-financial-regulator-fines-bgl-bnp-paribas-3-million/15571858.html

https://delano.lu/article/cssf-fines-bgl-bnp-paribas-3m

https://www.cssf.lu/wp-content/uploads/S_43_B_BGL_BNP_Paribas_S.A._080524_en.pdf