Banking licence of Flora-Moscow Bank revoked and provisional administration appointed
By its Order No. OD-2588, dated 05.10.2018, the Bank of Russia revoked the banking licence from the Moscow-based credit institution Joint-stock Company Commercial Bank Flora-Moscow or JSC CB Flora-Moscow (Registration No. 533) from 5 October 2018. According to its financial statements, as of 1 September 2018, the credit institution ranked 450th by assets in the Russian banking system.
The operations of JSC CB Flora-Moscow were found to be non-compliant with the law and Bank of Russia regulations on countering the legalisation (laundering) of criminally obtained incomes and the financing of terrorism with regard to the completeness and reliability of information provided to the authorised body about operations subject to obligatory control.
JSC CB Flora-Moscow has long been in the purview of the Bank of Russia due to the bank’s transit and dubious transactions connected with cash-out transactions and overseas money diversion. The regulator took measures repeatedly to preclude the bank’s involvement in suspicious activity of its customers. However, the effectiveness of AML/CFT in the credit institution was low. These circumstances showed that the management and owners of JSC CB Flora-Moscow were reluctant to take any efficient measures in this regard.
The Bank of Russia repeatedly (6 times over the last 12 months) applied supervisory measures against JSC CB Flora-Moscow, including the restriction on household deposit taking.
Under these circumstances, the Bank of Russia took the decision to revoke the banking licence from JSC CB Flora-Moscow.
The Bank of Russia took this decision due the credit institution’s failure to comply with federal banking laws and Bank of Russia regulations, repeated violations within one year of the requirements stipulated by Articles 6 and 7 (except for Clause 3 of Article 7) of the Federal Law ‘On Countering the Legalisation (Laundering) of Criminally Obtained Incomes and the Financing of Terrorism’, and the requirements of Bank of Russia regulations issued in compliance with the said Federal Law, and taking into account repeated applications within one year of measures envisaged by the Federal Law ‘On the Central Bank of the Russian Federation (Bank of Russia)’.
Following banking licence revocation, JSC CB Flora-Moscow’s professional securities market participant licence was cancelled.
By its Order No. OD-2589, dated 05.10.2018, the Bank of Russia has appointed a provisional administration to JSC CB Flora-Moscow for the period until the appointment of a receiver pursuant to the Federal Law ‘On Insolvency (Bankruptcy)’ or a liquidator under Article 23.1 of the Federal Law ‘On Banks and Banking Activities’. In accordance with federal laws, the powers of the credit institution’s executive bodies were suspended.
JSC CB Flora-Moscow is a member of the deposit insurance system. The revocation of the banking licence is an insured event as stipulated by Federal Law No.
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