A Dutch court has called on prosecutors to launch a criminal probe into new UBS CEO Ralph Hamers’ role in anti-money laundering lapses at his previous employer ING Group.
The Court of Appeal in The Hague has now ordered the prosecution of Hamers even though it upheld the settlement agreement signed by ING on the matter.
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The charges included the bank’s failure to prevent money laundering and terrorism financing by failing to have a proper background check on clients and failing to flag suspicious transactions.
In 2018, ING inked a €775m ($936.6m) settlement agreement with Dutch prosecutors to resolve the case.
The settlement amount included a fine of €675m and €100m for disgorgement.
However, some investors complained to the Dutch courts saying that Hamers should face action for the failures. Hamers was at the helm of ING from 2013 until June 2020.
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By GlobalDataThe court said that it is “of the opinion that there are sufficient leads for a successful prosecution of this former director as the de facto supervisor of the criminal offenses committed by ING”.
“The facts are serious, no settlement has been reached with the director himself, nor has he taken any public responsibility for his actions,” it said.
ING said that takes its “responsibility extremely seriously” and has carried out a programme which include enhancing customer files (KYC), carrying out structural upgrades to compliance policies, among others.
“We welcome the ruling regarding ING but regret the decision to order the prosecution of our former CEO, which goes against the assessment of the public prosecutors that, based on the investigation, there are no grounds for a case against ING employees or former employees,” ING said in a statement.
The ruling is crucial for Hamers, who took reins of UBS formally last month, replacing Sergio Ermotti.
Earlier this month, the bank appointed Sabine Keller-Busse as the new president of UBS Switzerland in the first key reshuffle under Hamers.
Hamers also extended the responsibilies of current UBS Global Wealth Management co-president Iqbal Khan, who will now also serve as the EMEA president.
In response to the matter, a UBS spokesman said that the bank has “full confidence in Ralph Hamers’ ability to lead UBS”.
