Combating money laundering, terrorist financing and other offences

As the “Hausbank” for small and medium entrepreneurs, ProCredit institutions make an important contribution to the economic and social development of the countries in which they operate. In doing so, the ProCredit group places great importance on providing transparent and socially responsible banking services. Our strict code of conduct and our exclusion list, which documents our unwillingness to enter into business relationships with individuals and companies whose activities are incompatible with our ethical values, form a binding frame of reference for all of our staff members. Based on how we see our role, we have imposed the strictest of standards on ourselves in order to combat money laundering, terrorist financing and other offences such as fraud and embezzlement. We consider combating money laundering to be essential to achieving our goal of promoting transparent and stable financial intermediation. It is our belief that taking rigorous action against suspicious clients and transactions makes a significant contribution to the stability of the wider economy.

The minimum standards followed by all ProCredit banks are in compliance with the anti-money laundering regulations of the Federal Republic of Germany as well as the guidelines imposed by the European Union, the Basel Committee on Banking Supervision (BCBS) and the Financial Action Task Force (FATF). However, our internal guidelines exceed these minimum standards in many regards.

The core measures and precautions which we have adopted in order to combat money laundering, terrorist financing and other acts punishable by law can be summarised as follows:

Transparent client relationships

Strict regulations are in place concerning the identification of clients (KYC –  the know-your-customer principle). This prevents individuals with dubious intentions from gaining anonymous access to the financial system. We apply this principle just as strictly to companies with complex structures, in order to ascertain exactly who the natural persons behind the corporation really are.

Training

To ensure that our staff are in a position to positively identify and “know” clients, we place great value on training. This includes mandatory courses for all new employees about the dangers of money laundering and what concrete measures can be taken to prevent it. In addition to this, staff are regularly trained with regard to new regulations and developments in the field of anti-money laundering.

Monitoring of client data, transactions and accounts

We have introduced special software group-wide, which enables us to detect and closely analyse any potentially suspicious activities. Another software module ensures compliance with national and international sanctions and embargoes. In this way, we are able to guarantee that we neither enter into business relationships with persons or companies on international watch lists or blacklists, nor do we permit transactions in their name or to their benefit.

Risk-based approach

All banks in the group apply the FATF-recommended risk-based approach. This means that besides applying the standard measures, each ProCredit bank analyses its own country-specific money-laundering risks and undertakes all appropriate additional measures.

Anti-money laundering officers

Every ProCredit bank appoints an anti-money laundering officer, who reports directly to the management board. Our anti-money laundering staff are responsible for applying the group-wide guidelines aimed at preventing money laundering, terrorist financing and other offences such as fraud and embezzlement. They co-operate with the local law enforcement authorities and report on economic crimes or suspicious clients and transactions, both to the management board and supervisory board of their own bank as well as to the ProCredit group-level anti-money laundering officer.

For more information, please contact: PCH.compliance@procredit-group.com