- Flickr / David Lytle
- The revelations of a massive money-laundering operation linking Russian money to Western companies and financial institutions is widening to include more European banks.
- ING is the latest lender to be named in relation to the so-called Laundromat scandal, as the Organized Crime and Corruption Reporting Project drips out its findings in partnership with other media outlets.
- Raiffeisen shares closed down 1.8% Wednesday after dropping by as much as 14% on Tuesday. ING shares dipped about 4% Wednesday before closing down 2.2%.
- “We take all signals of this kind, many from years ago, very seriously,” ING said.
The revelations of a massive money-laundering operation linking Russian money to Western companies and financial institutions is widening to include more European banks.
The so-called Troika Laundromat scheme was uncovered by investigative journalists at the Organized Crime and Corruption Reporting Project and the Lithuanian news site 15min.lt. The OCCRP said the operation allowed the flow of some $4.8 billion of funds from Russian companies and people into Europe and the US from 2003 to early 2013.
The project traced the scheme’s origins to Russia’s largest private investment bank, Troika Dialog.
ING, one of the largest banks in The Netherlands, is the latest lender to be named in relation to the scandal as the OCCRP drips out its findings in cooperation with various media outlets. The lender’s shares dropped more than 4% after the Dutch paper Trouw reported that hundreds of millions in suspicious euros were funneled through ING’s Russian operations.
Media reports have named numerous other lenders with suspicious accounts or links to Russia (Bloomberg has a handy list), including Nordea, Swedbank, ABN Amro, Rabobank, and Danske Bank (which was already ensnared in a money-laundering scandal involving Russian funds).
Dankse Bank, alongside the Lithuanian lender Ukio Bankas, processed payments through Austrian accounts worth about $967 million, according to Hermitage Capital Management via the OOCRP.
“We take suspected money laundering activities very seriously and invest significant resources to these important questions,” Swedbank said in a post. “We are investigating the allegations presented in the media, and we are cooperating with the relevant authorities.”
ABN Amro indicated it had nothing to do with the current allegations, as the bank was bought in 2007, moving any of the funds mentioned into the accounts of other lenders, in response to Business Insider’s requests for comment.
Nordea, Rabobank, and Danske Bank didn’t immediately respond to requests for comment on Wednesday.
“We take all signals of this kind, many from years ago, very seriously as we have been doing over the past years, especially in the context of our Know Your Customer (KYC) enhancement programme,” the ING spokesman Raymond Vermeulen said in a statement to Business Insider.
ING already paid a €775 million ($875 million) fine last year following a Dutch investigation that found criminals had been able to launder money through its accounts for several years. Its shares closed down 2.2% Wednesday.
Raiffeisen Bank was hit by the scandal when information was first disclosed by newspapers including The Guardian, with its shares dropping as much as 14% on Tuesday. The Austrian lender has a large presence in Russia, and its shares dropped 1.8% on Wednesday.
Raiffeisen, in a comment to Business Insider after the revelations on Tuesday, said it was conducting an internal investigation and “complies with all anti-money laundering requirements.”
Deutsche Bank – already plagued by controversies – has also been affected, with more than $889 million said to have moved through the bank’s accounts to those of the Troika Laundromat, according to the German publication Süddeutsche Zeitung.
Deutsche Bank declined to comment beyond a statement on Tuesday in response to the allegations. “Deutsche Bank’s clients are so-called respondent banks,” it said then. “It is first and foremost the task of the respondent bank to check its customers in accordance with the applicable know-your-customer regulations.”