(Corrects April 25 story to make clear anti-money laundering audits can be part of routine bank oversight, adds National Bank of Belgium official)
By Francesco Guarascio
BRUSSELS (Reuters) – Belgian bank Degroof Petercam has been audited by the Belgian central bank over how it guards against money laundering, and a source at the European Central Bank said the ECB’s Supervisory Board would take up its case at a meeting starting on Thursday.
In a statement on Wednesday, which came after national media reported alleged money-laundering flaws at the bank, Degroof Petercam said it was implementing recommendations the National Bank of Belgium made after the audit.
The Degroof Petercam issue is on the agenda of this week’s board meeting of the Frankfurt-based ECB supervision body, a European Union official told Reuters on Thursday. The board, which meets on Thursday and Friday for a regular biweekly meeting, assesses risks at banks under its watch.
Under EU rules, money-laundering risks are mostly monitored by national authorities. The ECB is the euro zone’s top supervisor of bank financial stability, which can be put at risk by exposure to financial crime.
“The case is on the agenda because it is not totally unimportant,” the official said. Audits on anti-money laundering procedures can be part of the regular oversight of banks but recommendations to improve governance and discussion by the ECB’s top supervisory body occur only in exceptional cases where there are reasons for concern, the source said.
An official at the National Bank of Belgium said Degroof Petercam is subject to regular checks but that the recent audit also took place because the Belgian supervisor’s risk indicators showed a need for closer scrutiny.
A spokesman for Degroof Petercam said the Belgian national bank carries out regular audits and rejected any accusation of money laundering.
“The investigation by the National Bank of Belgium is therefore not one into money laundering facts within the bank but a standard audit on the anti-money laundering procedures that is regularly performed by regulators on Belgian and European financial institutions,” the bank said in a statement.
An ECB spokesman declined to comment. The Belgian central bank was not immediately available for comment.
Degroof Petercam, which is not listed and focuses on serving wealthy clients, is one of the seven Belgian banks that fall under the direct supervision of the ECB. Frankfurt considers it significant at the euro zone level because of its large cross-border assets, which are concentrated in the bank’s subsidiaries in France, Luxembourg and Spain.
Money-laundering allegations caused the collapse of two banks in the euro zone last year, Latvia’s ABLV and Malta’s Pilatus Bank.
Danske Bank, Denmark’s largest lender, and Sweden’s Swedbank have seen their shares drop after allegations of their involvement in a money-laundering scandal in the Baltic region.
(Reporting by Francesco Guarascio; Additional reporting by Alissa de Carbonnel; Editing by Leslie Adler)