Italian trial date set for Bank of China and others in US$5 billion money-laundering case
PUBLISHED : Thursday, 06 August, 2015, 2:46pm
UPDATED : Thursday, 06 August, 2015, 4:23pm
Associated Press in Florence
Residents walk past the Bank of China branch in downtown Milan, Italy. The branch is accused of allowing billions of euros to be smuggled out of Italy through its accounts. Photo: AP
A US$5 billion money-laundering trial of the Bank of China and 297 other defendants in Italy is scheduled to begin in March, deputy public prosecutor Giulio Monferini said.
At issue is more than 4.5 billion euros (HK$38 billion) allegedly smuggled out of Italy to China through a money transfer service part-owned by Chinese immigrants.
Prosecutors in Florence said nearly half the money was funnelled through the Bank of China’s Milan branch, which earned over 758,000 euros in commissions on the transactions. When the hearings begin in March, a judge will decide whether to press ahead with charges of money-laundering and assisting a mafia-like organisation against the bank’s Milan branch and four of its employees.
The Bank of China has denied wrongdoing. In a June statement to the Hong Kong stock exchange, the bank said it had not received formal prosecution documents but would cooperate with Italian authorities. Lawyers for the money transfer network’s owners have said their clients are not guilty.
China’s central bank and other government agencies vowed to strengthen money-laundering controls after news of the Italian investigation into the Bank of China broke, the state-run China Daily newspaper reported last week.
The Bank of China is not the only major Chinese bank with overseas branches facing scrutiny. In July, the US Federal Reserve told China Construction Bank to strengthen its anti-money-laundering framework and improve customer due diligence and monitoring of suspicious transactions.
Italian prosecutors allege that the money transfer network, Money2Money, operated like a mafia, using threats and coercion to maintain a near monopoly on money transfers from Italy to China. Money2Money also had an exclusive contract with the Bank of China’s Milan branch which stipulated that the bank would not work with any other firm to send money from Italy to China, prosecutors said.
Italian officials said China did not cooperate with the money-laundering investigation.
