11 December 2015
FBME Bank has strongly rejected the supposed evidence that the Central Bank of Cyprus (CBC) has claimed to have found of failings in its anti-money laundering (AML) and CTF procedures and will be looking for legal redress against the imposition of CBC’s proposed fine.
Furthermore, FBME states that this appears to have been a manufactured judgment based on a CBC-commissioned audit of the Bank in the summer of 2014. FBME questions why it has taken the CBC almost a year-and-a-half to reveal its supposed findings. It points to the fact that the FinCEN agency in the United States has had to re-open its period for assembling and assessing evidence to late January 2016 after US courts halted its attempt to impose its Final Rule on FBME Bank, and it is suggested that this development and the release of unfounded findings by the CBC are connected.
It should be also noted, says FBME, that the supposed failings refer almost exclusively to procedures and not to any monetary transactions at FBME Bank. FBME also points out that the CBC statement contradicts the results of independent forensic investigations conducted by the US offices of leading international audit firm, Ernst and Young (E&Y) and an audit carried out a year earlier by KPMG, Germany. Some enhancements were suggested in line with international best practice and neither firm identified any breaches of relevant EU and Cyprus law and directives.
These investigations, the results of which have been provided to FinCEN, demonstrate that FBME’s procedures incorporate the requirements of the European Union third money laundering directive and the fourth issue of Cyprus’ directive in accordance with Article 59(4) of the Republic’s anti-money laundering laws. Moreover, Ernst and Young also reported that FBME “… has protocols in place that allow the Bank to continuously keep the Program aligned with these legal requirements.”