Superintendency of Banks (SBP) versus Balboa Bank and Trust

[Keith Woolford]

Superintendency Denies Other Banks are Under Scrutiny

The Superintendency of Banks, for the second time in less than a week, has issued a statement denying it is involved in the intervention of any banks beyond Balboa Bank & Trust.

"The Superintendency of Banks reiterates to the citizenry in general that we are not starting intervention of any bank in particular. The banking system in Panama is very solid and stable with regard to liquidity and solvency levels. All banks meet the requirements of liquidity and capital required by the legal and regulatory framework," it said. "We recommend to the community that it pay attention only to official communications issued by this institution and disregard rumors on social networks."

It also noted that spreading false news that would endanger the national economy or public credit shall be punished by imprisonment of two to five years in prison.

A similar communication was published May 7, two days after the Office of Foreign Asset Control (OFAC) of the U.S. Department of the Treasury included Abdul and Nidal Waked, as well as other members of their families and 68 of their businesses, on the Clinton List for being linked to money laundering and drug trafficking.

Last week, the superintendency took administrative and operational control of the Balboa Bank & Trust, one of the companies included in the Clinton List.

- See more at: http://www.prensa.com/in_english/intervencion-particular-Superintendencia-Bancos-Panama_21_4481761788.html#sthash.yYojHdeO.dpuf

 

Edited May 13, 2016 by Keith Woolford

[Roger B]

In the social media like twitter and facebook there was a gossip that another bank (Banistmo) was also intervened or under scrutiny.  In Panama it is famous for making square balls to roll.  It spreaded like a virus that make so much noise and was heard by the people of the Superintendency of Banks.   That is why the agency publish their official communication.

[Keith Woolford]

Some people seem to enjoy fear mongering. There is an article out there today stating that several Panamanian banks have lost their U.S. correspondent status.

Nothing has been posted on the Superintendent of Banking's website, or reported in the Panamanian press that would indicate this to be valid information.

In the first paragraph of yesterday's press release, the Superintendent advised that spreading unfounded rumors is an illegal act.

Edited May 13, 2016 by Keith Woolford

[Keith Woolford]

The author of the article is Kenneth Rijock, a confessed money launderer.

https://www.google.com/search?biw=1120&bih=590&q=kenneth+rijock+the+laundry+man&oq=ken+rijock+laundryman&gs_l=serp.1.0.0i71l8.0.0.0.16742.0.0.0.0.0.0.0.0..0.0....0...1c..64.serp..0.0.0.ixtt-Ki9H-o

[Bud]

I struggled with this posting for several reasons. "Panama banks lose US correspondent accounts" is the title of an online banking article of the CaribbeanNewsNow.com website (click on that name to see the online version of the article). If this is in fact true, then it seems to be a really big deal for just about everyone in Panama.

Here is the article itself:

Quote

Panama banks lose US correspondent accounts
Published on May 13, 2016
By Kenneth Rijock MIAMI, USA -- Multiple sources in Panama City are reporting that several local financial institutions have lost their correspondent accounts in the United States, and American bank clients seeking to transfer funds to Panama are unable to complete any wire transactions through those correspondents. Banco General SA and Banco Nacíonal de Panama SA are among those who reportedly are now without any means of receiving funds from the United States financial structure. To add to the unease in Panama City, Banco General is alleged to be currently under investigation by a US law enforcement agency, together with a number of other banks. Americans who own businesses in Panama are now completely unable to pay their staff, and to cover expenses incurred in the normal course of business. Given Panama's strong laws regarding employee rights, absentee owners face immediate civil, as well as even criminal, liability, for non-payment of salaries and social security taxes. Additionally, if nonresidents cannot pay their mortgages on Panamanian real estate holdings, the banks will foreclose; personal property or other assets of foreign investors could also be seized, with or without legal action, if Americans default on their obligations. The abrupt American termination of correspondent account relationships with banks located in several small Caribbean tax havens has left several other countries in the region without the ability to transact business with US companies, and there does not seem to be a solution to this vexing problem. Kenneth Rijock is a banking lawyer turned-career money launderer (10 years), turned-compliance officer specialising in enhanced due diligence, and a financial crime consultant who publishes a Financial Crime Blog. The Laundry Man, his autobiography, was published in the UK on 5 July 2012.

 

[Keith Woolford]

Wasn't much of a struggle for me, Bud. I tend to discount information having less than one credible source.

It's been over a week since this story was originally floated and not only does it remain unverified, the existence of any problems within the Banking system was denied by the Superintendent of Banking of Panama. If there were problems, thousands of international transfers would have already been affected and fails would have been well publicized.

[Bud]

Thanks, Keith. My gut instinct was that the article was, at best, specious. Otherwise it would have been front page headlines on every newspaper, and the lead article on TV and radio news.

Back into my cocoon now.

[Moderator_02]

Quote

Panamanian Bank to Pass into Costa Rican Hands

The Superintendency of Banks has granted the banking group BCT approval to acquire Balboa Bank & Trust, putting an end to the reorganization process that began a year ago.

Tuesday, June 20, 2017

From a statement issued by the Superintendency of Banks in Panama:

Reorganization of Balboa Bank & Trust enters its final phase 

Panama June 19 .- The Superintendency of Banks of Panama (SBP) is pleased to announce that the reorganization of Balboa Bank & Trust, Corp. and its subsidiaries is in its final phase.  After an arduous and extensive process, and based on the two binding proposals that have been evaluated, the SBP estimates that the one presented by Grupo Bancario BCT, with capital from Costa Rica, with general license to operate in our jurisdiction since the year 1994, meets the requirements to complete a process of sale for 100% of the shares of Balboa Bank & Trust, Corp.

In May 2016, the SBP took administrative and operational control of Balboa Bank & Trust, Corp., in view of the fact that the banking institution, its subsidiaries and its holding company were included in the so-called Office Of Foreign Assets Control (OFAC) of the United States Department of the Treasury.

 

http://www.centralamericadata.com/en/article/main/Panamanian_Bank_to_Pass_into_Costa_Rican_Hands

[Moderator_02]

Quote

Million dollar Sue Against Banking Regulator

Arguing that the institution was negligent in the process of intervention and sale of the bank, in Panama Balboa Bank shareholders filed a $74 million lawsuit against the Superintendence of Banks.

Monday, November 26, 2018

The legal appeal filed by the Balboa Bank shareholders and admitted by the Third Chamber of the Supreme Court of Justice, points out to the Superintendence of Banks of Panama (SBP) to cause presumptive damages because of the sale price fixing of the bank's shares.

After the bank was intervened in May 2016 after being included in a list of individuals and companies supposedly linked to asset laundering, in October 2017, the sale of the financial entity was reported, when SBP informed that the completion of the transaction that perfected the Purchase and Sale Agreement between Corporación BCT, S.A. and Balboa Bank & Trust, Corp. and its subsidiaries had taken place.

See "Panama: Balboa Bank Has New Owner"

According to the shareholders, the process of selling the bank was full of irregularities and illegality, which is the main reason for the lawsuit by the group of shareholders that owns Balboa Bank.

Regarding the reasons for the lawsuit, Ramón Martínez, one of the bank's shareholders, explained to Prensa.com that "... Balboa Bank never acted as part of a supposed money laundering network, something that must have been the regulator's stronghold for OFAC to take them off the list. The Superintendence was asked on four occasions to conduct a forensic audit on the bank to validate whether the companies of the supposed Waked organization had used the bank for money laundering, but the banking regulator never did."

Martinez adds that "... Balboa Bank had not been fined by the SBP for failures in its control systems for the prevention of money laundering. And of the process of taking control and reorganization that the regulator made, no complaint was filed against directors or officials of the bank for alleged money laundering violations. If the Superintendence gives the U.S. accusations as true, would that imply that the regulator allowed an alleged criminal organization to use the bank for money laundering and never noticed?”.

 

https://www.centralamericadata.com/en/article/main/Banking_Regulator_Sued_for_Millions

[Moderator_02]

Quote

Laundering shadow leads to $74 million lawsuit for regulator

Posted on November 28, 2018 in Panama

Post Views: 162

 

Shareholders of the Balboa Bank that was included in a U.S. list of alleged  money launderers with links to drug lords  are suing Panama’s banking regulator  for $74 million  arguing that the institution was negligent in the process of intervention and sale of the bank

The legal appeal admitted by the Third Chamber of the Supreme Court says the Superintendence of Panama Banks (SBP) caused presumptive damages because of the sale price fixing of the bank’s shares.

After the bank was intervened in May 2016 when  included in a list of individuals and companies supposedly linked to asset laundering, in October 2017, the sale of the financial entity was reported, when SBP informed that the completion of the transaction that perfected the Purchase and Sale Agreement between Corporación BCT, S.A. and Balboa Bank & Trust, Corp. and its subsidiaries had taken place.

According to the shareholders, the process of selling the bank was full of irregularities and illegality.

Ramón Martínez, one of the bank’s shareholders, told Prensa.com that “… Balboa Bank had not been fined by the SBP for failures in its control systems for the prevention of money laundering. And of the process of taking control and reorganization that the regulator made, no complaint was filed against directors or officials of the bank for alleged money laundering violations. If the Superintendence gives the U.S. accusations as true, would that imply that the regulator allowed an alleged criminal organization to use the bank for money laundering and never noticed?”.

As a result of the inclusion of both companies in the “Clinton” list drawn up by the US Treasury Department, the respective Superintendents have ordered interventions.

For its part the Administration of Supervision and Regulation of Non-Financial Subjects activated special supervisions in non-financial companies which are listed by the OFAC as part of the network, in this case those operating in Colon Free Zone: Grupo Wisa, S.A., Vida Panama S.A., Servicio de Equipo Rodante Incorporado and Grupo Cima S.A., among others.

Abdul and Nidal Waked

A list of people and companies involved in international money laundering includes the brothers Abdul and Nidal Waked, another six individuals, and 68 companies, among which is Balboa Bank.

The businessmen Abdul and Nidal Waked and companies such as Grupo Wisa, Vida Panama and Balboa Bank, have been included in the “Clinton” list which indicates which people and related organizations are linked to money laundering and drug trafficking activities.

 

https://www.newsroompanama.com/news/panama/laundering-shadow-leads-to-74-million-lawsuit