The Bank deeply regrets that vulnerabilities should have come to light, but it reiterates that there is no suspicion that money laundering has taken place via Íslandsbanki’s systems. The Central Bank made comments in a total of 12 items centring on the framework, execution, and supervision of Íslandsbanki’s AML defences. Íslandsbanki conceded to the Central Bank’s comments and asked to conclude the matter with a settlement agreement to be published on the Central Bank website.
In recent years, the regulatory framework for AML measures has been tightened on a regular basis, as customers have noticed, including more detailed risk assessments and more stringent authentication requirements for foreign currency purchases. To a large extent, Íslandsbanki has already responded to demands for reforms in the wake of the Central Bank’s recommendations, and will complete its reforms by end-August 2024.
The Central Bank found a total of 12 flaws in Íslandsbanki’s execution, ranging from somewhat inadequate to materially inadequate. The flaws fall into four main categories, as is described below.