Belgian banking sector is strongly opposed to a minimum basic banking service that is granted indiscriminately to all companies
30 June 2020 - 4 min Reading time
The Belgian banks are a fundamental link in combating and detecting organized crime - ranging from terrorism, corruption, drug trafficking to human trafficking. While building and maintaining a good relationship with their clients is crucial, they do not want to become a hub for money laundering or support or facilitate organized crime.
That is why the Belgian banking sector is strongly opposed to a minimum basic banking service that is granted indiscriminately to all companies. A banking relationship with companies that do not attach great importance to the traceability and transparency of transactions is therefore usually at odds with tackling financial crime.
Banks play an important role in detecting organized crime
Year after year, the role of banks in the fight against financial and organized crime is growing. They are a fundamental link in combating and detecting organized crime. This involves various activities, such as terrorism, corruption, drug trafficking and even human trafficking.
Of course, building and maintaining good relationships with their customers is essential for Belgian banks, but this should certainly not be done at any price. Belgian banks do not want to support or facilitate organized crime, let alone become a hub for money laundering.
Moreover, in addition to the legal obligations, banks also have a moral commitment to society in general and their shareholders and customers in particular to fully fulfill the gatekeeper function. Banks must therefore be able to apply a comprehensive risk-based approach at all times, of course in the first place when accepting customers.
Alle banken zijn verplicht om waakzaam te zijn voor verdachte financiële praktijken die verband houden met witwassen, fraude of financiering van terrorisme. Ze moeten die praktijken proactief opsporen en, indien nodig, verder onderzoeken en melden bij de bevoegde diensten. Hiervoor worden gerichte controles gedaan. Banken spelen dus een cruciale rol als “poortwachter of gatekeeper” in de strijd tegen witwassen en terrorismefinanciering.
In recent years, politicians and regulators have clearly asked the banking sector to step up their efforts in this area. Banks have invested massively in - and continue to do so - stricter monitoring and detection procedures. These procedures allow banks to fully assume their legal role in the fight against money laundering and to report suspicious customers, transactions or facts to the anti-money laundering cell (CFI), so that they can be further investigated and possibly reported to the public prosecutor's office. In addition, the basic banking services law would oblige banks to state reasons for refusing certain customers, which is explicitly prohibited in certain cases by the anti-money laundering law in order to guarantee the proper functioning of the anti-money laundering cell and the public prosecutor's office.
Traceability and transparency are crucial
In 2020, certain practices will no longer be acceptable. This includes the use of cash for large transactions or the lack of traceability and transparency of transactions.
As a result, some companies, which still have questionable practices, are now struggling to establish and maintain a banking relationship.
Providing a basic banking service to companies is - however attractive it may sound at first glance - mopping up with the tap open. This in no way solves the underlying problem, which is the regular detection of suspicious financial transactions and, consequently, the exclusion of moral persons who are objectively suspected. Tackling financial crime, which harms society as a whole, must remain the priority.
For this reason, the Belgian banking sector strongly opposes the introduction of a basic banking service that is granted indiscriminately to all companies, as recently explained in a hearing to the members of the Parliamentary Committee on Economy.
Febelfin is of course always open to a further dialogue with the authorities and with the companies involved to consider how we can increase the transparency and traceability of their transactions, and how we can make banking services as accessible as possible.
