Court slashes Bunq fine over money laundering checks

Photo: Bunq

Online bank Bunq has won its case against the central bank to have two fines for failing to carry out proper money laundering sharply reduced.

Judges in Rotterdam said the fines should be slashed by 85% because the mistakes made by Bunq were far less serious than the central bank had claimed.

The Dutch company appeal court said last October the Dutch central bank was wrong to ban Bunq from screening its clients using AI techniques and data analyses.

The central bank had said Bunq was not properly complying with anti-money laundering legislation which requires banks to run risk profiles of clients and monitor their transactions accordingly.

Bunq said this can best be done using AI, but the central bank disagreed, ordering the app-based bank to change its strategy.

The appeal court said that the central bank had not sufficiently proved Bunq’s methodology was not in line with the legislation and rejected the central bank’s claim Bunq did not have enough information about its business clients.

The court did find, however, that Bunq had not done enough to establish how its customers made their money or to investigate the source of income of ‘politically prominent people’.

The court first slashed the fines facing Bunq from almost €900,000 to €375,000 but has now reduced it to €128,000. This was partly due to the length of time the proceedings have taken and the fact that Bunq was forced to pay an independent body to analysis its approach – a move which later proved to be unnecessary.

Bunq founder Ali Niknam told the Financieele Dagblad he was “pleased” most of the fine had been scrapped. “On some points it is correct because we are talking about the period prior to 2018 when we were not perfect,” he said.

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