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Inside Compliance (Aug 7th, 2019)

1. The Dutch central bank has ordered private bank ABN AMRO to check its retail clients for money laundering and other financial crimes. The order comes as part of a government crackdown on the banking industry. Last year, another Dutch bank, ING, paid $900 million to settle money laundering charges. ABN AMRO CEO Kees van Dijkhuizen said that complying with the order will cost the bank more than $120 million and that the bank could be subject to fines. He said the bank would hire more compliance officers. "In general, across the bank we will take all remedial actions necessary to ensure full compliance with legislation," Van Dijkhuizen said. - ASSOCIATED PRESS

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2. Profits at the Commonwealth, Australia's biggest bank, are down 8.1 percent following the bank's payout of $1 billion to cheated customers. Shares fell 1 percent on Wednesday. The bank has engaged in shady practices including charging fees to dead people and aggressively selling its products to customers. “That cash net profit after tax is of course subdued and it’s been impacted by higher remediation costs of almost $1 billion during the course of the year, as well as elevated risk and compliance spend,” chief executive Matt Comyn said. The bank is still being investigated for breaches in Australia's money-laundering and financing terror laws. - GUARDIAN

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3. A Swiss bank could have spared itself a $10.7 million fine if it had listened to its own compliance officer. The U.S. Justice Department announced Monday it had reached the settlement with LLB Verwaltung (Switzerland) AG for allegedly hiding assets from U.S. tax authorities related to transfers from U.S. banks following the financial crisis. According to the Justice Department, the unnamed compliance officer had recommended to his superiors that they force clients to disclose their accounts to the Internal Revenue Service or to contact the Justice Department and offer to disclose who had helped them hide their assets in return for avoiding prosecution. - LAW.COM

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4. New York-based International Flavors & Fragrances said Tuesday that it had discovered potential bribes in Russia and Ukraine by an Israeli company it bought last year. International Flavors made the discovery after its $6.4 billion purchase of Israel-based Frutarom Industries. International Flavors alerted the Justice Department to the possible misbehavior and launched its own investigation. “We have committed to the highest standards of ethics and compliance and have strict compliance policies in place,” International Flavors Chief Executive Andreas Fibig said Tuesday. - WALL STREET JOURNAL

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5. U.S. regulators have fined accounting firm PricewaterhouseCooper's Mexican affiliate $100,000 for engaging with a Mexican bank while ignoring conflicts of interest. PwC's Mexican operation agreed to work with the unnamed Mexican bank, even though six PwC officers had personal financial relationships with the bank.  “Through our ongoing efforts, PwC Mexico continues to add additional controls to achieve our audit quality objectives and maintain independence and objectivity," PwC Mexico said in a statement. - COMPLIANCE WEEK

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6. South African regulators reduced on Tuesday a fine on the India Bank of Baroda's local outfit. South Africa's Prudential Authority had fined the bank $733,000 in 2016 for non-compliance with money-laundering controls and related issues. The bank appealed and has now seen the fine reduced to $26,600 dollars. In 2018, South African police raided the bank and seized documents related to a corruption investigation into former president Jacob Zuma. - REUTERS

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7. The U.K.'s Serious Fraud Office on Tuesday published steps companies can take to cooperate with prosecutors. The SFO said a company's cooperation would be taken into account in the event of prosecution regarding financial crimes and non-compliance. The SFO advised companies to waive legal privilege on witness interviews conducted by company lawyers as well as privileged documents. But that may be a step to far for companies, said a legal expert. - WALL STREET JOURNAL

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8. Australian regulators said Wednesday that they are seeking compensation from four wind farm operators that contributed to a 2016 blackout in South Australia. The Australian Energy Regulator said the companies -- two Australian, one owned by New Zealand and another by China -- failed to ensure their plants could handle disturbances such as the two tornadoes that hit South Australia on Sept. 28, 2016. The regulator seeks penalties and stepped-up compliance at the companies, which have either denied wrongdoing or declined to comment. - REUTERS

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9. Scotiabank seeks a compliance senior manager in its New York office. The manager will oversee the bank's anti-bribery and anti-corruption program. Scotiabank is looking for someone with 10 years of experience at a major international bank.

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10. Accenture seeks an internal controls and compliance senior manager. The position, based in Seattle, will focus on Sarbanes Oxley compliance. The person hired will design and maintain internal controls and provide input to external auditors.

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Paul Wachter is a California-based journalist who has written for The New York Times Magazine, Harper's, ESPN, and other publications. 

Editor: Kim Lyons (Pittsburgh-based journalist and managing editor at Inside).

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