ING Bank to pay record $619 million to settle US sanctions charges

13 Jun 2012

ING Bank will pay a record $619 million to settle US government accusations that the Dutch bank and its employees helped cover up billions of dollars in fund transfers, thereby violating US sanctions banning transactions with Cuba, Iran and other countries.

The US Treasury said that the settlement is the largest settlement of any kind with the US Treasury's Office of Foreign Assets Control (OFAC) to date.
 
Despite various sanctions in place against Cuba, Iran, Burma, Libya and Sudan, ING Bank's Wholesale Banking Division routed more than $1.6 billion through the US, keeping the US financial system open for "state sponsors of terror and other sanctioned entities," the department said.

The US Treasury Office alleged that ING Bank's unit moved billions of dollars from the early 1990s until 2007 through the US financial system on behalf of Cuban, Burmese, Sudanese, Libyan and Iranian clients by stripping out data embedded in payment messages that would have identified the illegal nature of the transactions.
 
Beginning in the 1990s, at the instruction of senior bank management, ING Bank employees in Curacao began omitting references to Cuba in payment messages sent to the US in order to prevent US financial institutions from identifying and interdicting prohibited transactions.
 
The practice of removing and omitting such information was also used by other branches of ING Bank's Wholesale Banking Division, including in France, Belgium, and the Netherlands, in processing US dollar payments and trade finance transactions through the US.
 
The US Treasury also alleged that the bank's senior management in France authorised and provided fraudulent endorsement stamps to Cuban financial institutions for processing travellers check transactions, which disguised the involvement of Cuban banks in these transactions when they were processed through the US.
 
Moreover, ING Bank's Trade and Commodity Finance business at its Wholesale Banking branch in the Netherlands routed payments made on behalf of US-sanctioned Cuban clients through other corporate clients to obscure the sanctioned clients' identities and its Romanian branch omitted details from a letter of credit involving a US financial institution in order to finance the exportation of US-origin goods to Iran.
 
''Our sanctions laws reflect core US national security and foreign policy interests and OFAC polices them aggressively. Today's historic settlement should serve as a clear warning to anyone who would consider profiting by evading US sanctions,'' said Adam Szubin, director of Treasury's OFAC.
 
Under the settlement, ING Bank is required to conduct a review and submit a report to OFAC regarding, its policies and procedures and their implementation of US dollar payments.
 
ING Bank is not the first bank to be hauled by the US agencies for similar violations. In 2009, Lloyds Banking Group agreed to pay a $350 million, and Credit Suisse Group AG paid $536 million, while  Barclays Plc paid $298 million in 2010 and JPMorgan Chase paid more than $88 million last year.