3 May 2015
Recent reports have incorrectly stated that FBME staff have approached the Police and the Central Bank of Cyprus to make certain unspecified allegations of breaches of Anti-Money Laundering Law. As far as FBME understands, the persons referred to are in fact individuals connected to British companies that are currently engaged in litigation with FBME regarding disputed invoices and services.
The persons in question were providing investigative services to external lawyers to assist in legal cases. They were effectively dismissed following concerns over the quality and integrity of their work, the size of their invoicing and certain concerns over past activities and business associations of which FBME subsequently became aware. Their access to data was carefully monitored and controlled and in the event that they seek to misappropriate confidential and privileged information we confirm that this effort will not adversely affect our clients. We note further that this material is historic and, as the two individuals themselves reported, was not material to the current state of FBME’s AML practices.
We understand that the two individuals have engaged the same law firm in Cyprus that represents the party that FBME Card Services is litigating against and have approached the Central Bank of Cyprus in an attempt to work for them.
FBME warned the Central Bank about these individuals but, apparently, the only interest of the Central Bank is closing down FBME at any cost to cover the acts and omissions of the Central Bank itself.
To state the truth, we note that after nine months during which the CBC fully controls FBME Bank’s Cyprus branch with a highly paid Administrator (€10,000), and despite the CBC’s multiple audits carried out, has now decided to appoint yet another Special Administrator with an outrageous monthly fee (€50,000 plus an additional 20% amount for expenses- yes, sums are correct!) and even to carry out one more audit of FBME’s AML practices. The CBC has never revealed the results of all its previous audits to FinCEN to assist in clearing FBME’s name. Nor has it explained why this is the only time in 32 years of supervision it was deemed necessary to have the involvement of the police.
This public flurry of activity seems to be a ham-fisted attempt to distract attention from the ineptitude the Central Bank of Cyprus has consistently demonstrated over the past nine months to justify its long inaction and inability to perform its supervisory role.
We will continue to provide updates on this matter from which readers can draw their own conclusions.