Amicable settlement proposed by the Board of Directors of the NBB and accepted by BANK X

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Amicable settlement proposed by the Board of Directors of the NBB and accepted by BANK X This amicable settlement, reached with due regard to the report of the Auditor dated 10 January 2013, was proposed by the Board of Directors of the National Bank of Belgium to BANK X on 22 January 2013, and was accepted by the latter on 8 February 2013.

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Having regard to Articles 36/9 and 36/10 of the Act of 22 February 1998 laying down the organic statute (hereinafter referred to as "the Act of 22 February 1998") of the National Bank of Belgium (hereinafter referred to as the "NBB"); Having regard to the decision of the Board of Directors of the NBB of 19 July 2011, whereby it was established that there are serious indications of the existence of a practice on the part of BANK X that may give rise to the imposition of an administrative fine within the meaning of Article 40 of the Act of 11 January 1993 on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing. The serious indications were related to BANK X's compliance with its duty of vigilance regarding certain banking transactions carried out by one of its customers, as well as its obligation to file a report with the Cell for Financial Information Processing (CFI) if it knows or suspects that transactions are related to money laundering or terrorist financing; Having regard to the decision of the Board of Directors of the NBB of 19 July 2011 to instruct the Auditor, pursuant to Article 36/9, §1, first paragraph of the Act of 22 February 1998, to conduct an investigation in favor of and against the aforementioned serious indications; Having regard to the fact that the aforementioned Act of 11 January 1993 and its implementing provisions have been amended several times since the facts in question occurred, meaning that the investigation focused on compliance with the Act of 11 January 1993 as applicable at the time of the facts in question, as well as compliance with the CBFA Regulation of 27 July 2004 concerning the prevention of money laundering and terrorist financing, taking into account the fact that the subsequent amendments did not entail a relaxation of the obligations existing for credit institutions at the time of the facts; Having regard to Articles 4, § 2 and 8 of the Act of 11 January 1993 as applicable at the time of the investigated facts, which respectively stipulate that institutions subject to the scope of the Act must display ongoing vigilance regarding the business relationship and ensure careful examination of the transactions carried out in light of the knowledge they have of their client and their profile, and must pay particular attention to examining transactions that they consider particularly susceptible to money laundering or terrorist financing due to the nature of the transactions or their unusual character given, inter alia, the accompanying circumstances, and must draw up a written report on this examination. Having regard to Articles 36, 37 and 38 of the CBFA Regulation of 27 July 2004 concerning the prevention of money laundering and terrorist financing. Under Article 36, credit institutions must organize appropriate first-line supervision, i.e., supervision by employees of the company who are in direct contact with clients, whereby these employees, based
on appropriate criteria made available by the institution, detect atypical transactions, pay specific attention to them, and draw up a written report which they submit to the anti-money laundering compliance officer of the institution. Pursuant to Article 37, credit institutions must supplement this first-line supervision with second-line supervision, which uses an automated monitoring system that must meet certain specific requirements and must deliver written reports on the detected atypical transactions to the anti-money laundering compliance officer. Pursuant to Article 38

2/3 credit institutions must deploy the necessary resources and develop appropriate procedures to, under the responsibility of the anti-money laundering compliance officer, proceed as soon as possible to the analysis of the written reports resulting from the first- and second-line supervision, in order to determine whether the facts in question must be reported to the CFI.
Having regard to Articles 12 and 13 of the Act of 11 January 1993 as applicable at the time of the investigated facts, pursuant to which institutions subject to the scope of the Act must bring to the attention of the CFI when they know or suspect that a transaction to be carried out is related to money laundering or terrorist financing, before carrying out the transaction or, insofar as reporting before the execution of the transaction is not possible, immediately after the execution of the transaction; Having regard to Article 36/10, § 3 of the Act of 22 February 1998, which allows the Board of Directors to propose an amicable settlement and, if its proposal is accepted, to publish it in a non-nominative manner on the NBB website; Having regard to the fact that BANK X effectively had the opportunity to familiarize itself with the findings of the Auditor's report before formulating its final comments via its lawyer in the latter's letter of 16 November 2012; Having regard to the fact that the final report of the Auditor was sent to BANK X together with the proposal for amicable settlement;

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Considering that the investigation in favor of and against has led to the following findings:
The investigated facts relate to transactions carried out during the period from January 2009 to April 2010 inclusive on account number 1 held with BANK X by Y NV. During the aforementioned period, significant amounts were transferred several times to this account, after which Y NV repeatedly made large cash withdrawals from this account. In total, a number of 'clustered transactions' took place on account 1 during the aforementioned period, i.e., the succession of one or more incoming transfers for significant amounts followed by one or more cash withdrawals for a large amount. The cash withdrawals were made at various local agencies and offices of BANK X. The withdrawals were always carried out by Ms. X, who had power of attorney on the aforementioned account but who had not exercised a mandate within the company Y NV since 2007. In a number of cases, a cash withdrawal for a large amount was followed shortly thereafter by a cash withdrawal for a smaller amount, which was then deposited into another account of Y NV at BANK X (account 2). The aforementioned transactions on the accounts of Y NV at BANK X, i.e., the large incoming transfers to account 1 followed by cash withdrawals for large amounts, apart from the subsequent cash deposits of smaller amounts to account 2, exhibited an unusual character in terms of their features and accompanying circumstances. The investigation revealed that the first-line employees of BANK X did not take any initiatives to draw up a written report on this matter and to report the transactions to the central anti-money laundering unit of the bank. Regarding the second-line supervision, it was found that the transactions of Y NV between mid-March 2009 and the end of April 2010 gave rise to some 'alerts' in the bank's automated control system, but that no further action was taken on these alerts during the period in which they were generated. The alerts were not analyzed by the central anti-money laundering unit and did not give rise to any written report on the basis of which the bank could assess whether a report to the Cell for Financial Information Processing ('CFI') was required. The alerts only gave rise to some analysis when the bank's compliance function opened an internal investigation into the aforementioned transactions, after the bank had received questions from judicial authorities regarding these transactions on 10 May 2010. Based on this investigation, the bank finally filed a report with the CFI on 9 August 2010.

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Having regard to the statements of BANK X recorded during the course of the investigation, which confirm the described factual elements; Considering that BANK X has provided full cooperation in the course of the investigation and, in particular, that BANK X, aware of the shortcomings in its internal organization in this regard, has already initiated measures to remedy the recurrence of the identified shortcomings; Considering that the amount of the amicable settlement must be proportionate to the nature of the facts; For these reasons, the Board of Directors of the NBB proposes to BANK X, as an amicable settlement within the meaning of Article 36/10, § 3 of the Act of 22 February 1998, the payment of the sum of EUR 250,000; If this proposal is accepted, this allows for a definitive resolution of the proceedings instituted against BANK X. Pursuant to Article 36/10, § 3 of the Act of 22 February 1998, the amicable settlement will be published in a non-nominative manner on the website of the NBB. The amounts to be paid under this settlement will be collected for the benefit of the Treasury by the Administration of the Cadastre, Registration and Domains. Done in Brussels, in three copies, on 22 January 2013. The Governor, Luc COENE