BSP fines RCBC P1B over laundering scam

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Metro Manila (CNN Philippines) — Rizal Commercial Banking Corp. (RCBC) has been slapped with a whopping P1-billion fine by regulators after its involvement in the Bangladesh money laundering scam.

The fine — the largest ever imposed by the Bangko Sentral ng Pilipinas (BSP) — represents a significant chunk of RCBC's profits, which totalled only P2.6 billion in the first half of the year.

But the Yuchengco-led bank says it has already set aside money, and it is reforming its systems to make sure the controversy doesn't happen again.

"The Monetary Board approved the imposition of supervisory enforcement action on RCBC to pay the amount of P1 billion, in connection with the special examination conducted by the [BSP] relating to the Bangladesh Bank cyber heist," regulators said in a statement on Friday.

In February, hackers stole $81 million from the Bangladesh central bank. They were able to spirit the money away in accounts set up in RCBC Jupiter Street, Makati branch.

A Senate investigation found that RCBC failed to act immediately on Bangladesh's initial warnings that the transactions were suspicious, as well as their later requests for the transfers to be stopped.

Further, RCBC's Jupiter branch officials were found breaking a host of banking regulations.

The bank accounts used in the heist were opened under false names. Branch manager Maia Santos-Deguito claimed businessman Kim Wong had vouched for the supposed accountholders. She also said she was compelled to follow Wong's orders since he was a close friend of then-RCBC President Lorenzo Tan.

The $81 million was later withdrawn, converted to pesos and gambled in a number of casinos in the country, before authorities could track it.

In a statement, RCBC said it accepted the fine and would pay it in two equal tranches — P500 million will be paid this year, while another P500 million is due in 2017.