FinCEN Files & Luanda Leaks: Suspicious EuroBIC payments further proof of anti-money laundering failures in Portugal

In the wake of the FinCEN Files investigations, Transparency International Portugal has asked the Bank of Portugal to urgently disclose its conclusions and the measures it has undertaken concerning the suspicious payments processed by EuroBIC – a small Portuguese bank part-owned by Isabel dos Santos that has been previously exposed for processing suspect funds from Angola.

These revelations lay bare the major vulnerabilities in the global anti-money laundering system. They also bring home the need for a long overdue discussion on Portugal’s role in facilitating cross-border corruption, Transparency International Portugal said today.

Among the confidential clients named in the FinCEN Files, investigative journalists have found Isabel dos Santos – currently investigated by the authorities in her home country Angola for embezzlement and money laundering – and her husband Sindika Dokolo.

Investigative journalists tracked 99 transactions with a total value of almost US$27 million that had been flagged and reported as suspicious to the U.S. authorities by EuroBIC’s correspondent banks. Transfers originated from EuroBIC (appearing in the database as “Banco Bic Portugues S.A.”) in Portugal and ended up in the accounts of the Cayman-based DMS Bank & Trust.

“Clarification around how EuroBIC handled these payments, and the extent to which the supervisory and financial intelligence bodies have acted, is critical not only for assessing one specific bank’s compliance with anti-money laundering obligations,” said Susana Coroado, Vice-President of Transparency International Portugal. “It will allow to kickstart, with utmost urgency, the long overdue discussion on the vulnerabilities of the Portuguese anti-money laundering system and the country’s role in cross-border corruption.”

In March, the Bank of Portugal told the parliament that the inspection into EuroBIC – triggered by the Luanda Leaks scandal – would be concluded later that month. It has been six months since the promise was made and the Portuguese public still does not know how the suspicious operations exposed by the Luanda Leaks investigations were handled by the bank and how the authorities have responded.

Transparency International Portugal is now calling on the Bank of Portugal to urgently release the conclusions of its most recent inspection.

The Bank of Portugal – the country’s central bank in charge of the banking sector – should also establish and clarify whether the transactions red-flagged by U.S. banks had also been reported as suspicious by EuroBIC to the authorities in Portugal. Dissuasive sanctions should apply should it be found that the bank failed to carry out its obligations and report these payments to the country’s financial intelligence unit.

Karina Carvalho, Executive Director of Transparency International Portugal, said: “Taken together, the revelations from the Luanda Leaks and the FinCEN Files present a definitive example that, despite glaring risks, anti-money laundering is not a priority for Portugal.”

“The vulnerabilities of the Portuguese banking sector posed by EuroBIC’s anti-money laundering weaknesses were already known to the Bank of Portugal back in 2015. Five years later, we still have to ask what the supervisory bodies did to address the problems and when we will see accountability for the apparent failures,” added Carvalho.

For any press enquiries, please contact:

João Oliveira, Transparency International Portugal

T: +351 218 873 412

E: [email protected]

Notes to editors

Other important events:

• January 2020: The Luanda Leaks investigations by the International Consortium of Investigative Journalists (ICIJ) reveal that Angola’s state oil company Sonangol had paid at least US$38 million to a consulting firm in Dubai, owned by a friend and business associate of Isabel dos Santos. Documents analysed by journalists show that the transfers, processed by EuroBIC, occurred hours after dos Santos was fired from Sonangol by Angola’s current president and her father's successor.
• January 2020: It is reported that the Bank of Portugal investigated EuroBIC in 2015. According to Reuters, it was then concluded that “the inherent risk (of illegal transactions) is considered as high” due to its shareholders’ close links to Angola, which ranked poorly on Transparency International’s Corruption Perceptions Index. At that time, the Bank of Portugal had made more recommendations to the bank to strengthen its anti-money laundering systems and identified the need for an external audit, by an independent entity, in order to assess the degree of compliance with these measures.
• March 2020: Transparency International welcomed a decision by a Portuguese court to order the seizure of all assets held in the country by Isabel dos Santos, including the 42.5 per cent stake in EuroBIC, valued at US$200 million, that she intended to sell.
• April 2020: The Organized Crime and Corruption Reporting Project investigations illustrate how a private network of banks in Portugal and Cape Verde had moved illicit assets to the European Union.
• July 2020: Flaws in Portugal’s anti-money laundering system are scrutinised by the European Parliament. The Members of the European Parliament called on the European Banking Authority “to assess whether there were breaches of either national or EU law, and to assess the actions taken by financial supervisors.”