MADRID: Spain’s top criminal court fined four former employees of Chinese mega-bank ICBC €22.7 million Thursday and handed them brief jail terms for laundering millions of euros for Chinese criminal groups.
The four included two senior executives of the Spanish branch of the partially state-owned Industrial and Commercial Bank of China.
As the jail terms were between three and five months, the four will unlikely spend any time behind bars as first-time offenders in Spain are usually spared jail for sentences of under two years if convicted of a non-violent crime.
The investigation began in February 2016 when police arrested six bank officials on suspicion of letting traders move money earned through smuggling and tax fraud out of the country, without checking the origin of the funds as required by law.
According to the National Court, ICBC – which entered the Spanish market in January 2011 – set up a Madrid-based entity whose services were mainly used by Asian criminal groups, notably the Emperador-Cheqia and Snake organisations.
It attracted €140 million in deposits, with Snake notably holding 70 accounts.
Bank staff, including its European director-general Liu Gang and two other employees, had “stubbornly disregarded” anti-money laundering regulations and were accepting cash deposits of any amount.
The court said Snake had paid €41.6 million in cash into the ICBC account between January 2011 and October 2012.
Staff had then helped by providing “a cover” for the movement of funds, through letting them split payments, use the bank’s anonymous in-house accounts and through the shared use of false ID documents, it said.
“The Spanish branch was an ideal instrument for massive-money laundering operations in the service of criminal organisations,” the court said.
Although Snake had tried to move money through “many other banks”, their anti-laundering mechanisms were alerted and the operations were blocked.
It said ICBC’s Spain branch was the only entity that did not send a single report about suspect operations to the Spanish money-laundering watchdog SEPBLAC between 2011 and 2016.
The court also flagged a “serious failure” on the part of the bank’s parent company, ICBC Luxembourg, saying it had failed in its obligation to ensure its subsidiaries were complying with anti-laundering regulations.
It also imposed restrictions on ICBC Spain, barring it from receiving subsidies, state aid, financial incentives or benefits for two years to ensure it “can avoid being exploited in the future in a similar criminal situation”.