Performance Management Issue
Money laundering at ING
Geert Compen u560443
Zoë Sedlářík u943593
Anne Zijlmans u626382
Lecturer: Reneé De Reuver
9 December 2019
1
, Introduction
In recent years, banks have regularly failed when it comes to money laundering (NU.nl, 2019).
One of the most recent failures is ING. Near the end of 2018, they paid an immense settlement
of 775 million euros to the Dutch public prosecutor (Vogel, 2018). Recently it was announced
that their case will not only be prosecuted in the Netherlands (Driessen, 2019), but also in Italy
(Kreling, 2019), and Belgium (De Telegraaf, 2019a). As a result, the case is not closed yet, and
continues to have a major impact on the company. The ING case distinguishes itself from others
as only top management is involved with money laundering and this results in a performance
management issue (BNN VARA, 2019). Indicators for this performance management issue are,
amongst others, the resignation of the financial director (Kleinnijenhuis, 2018), the elimination
of employees’ bonuses (Koenis, 2019), and the need to recruit inexperienced employees and
retraining (NOS Nieuws, 2019).
This paper aims for a thorough analysis of the performance consequences for ING due
to money laundering. It provides an advisory performance management intervention to increase
overall performance and to prevent this issue in the future.
2
, Case description & analysis
In order to be able to analyze what went wrong at ING and to learn how to prevent future
occurrences of money laundering, it is crucial to gain a better understanding of the company
and the sector it operates in. Starting with the sector, as a bank, ING is part of the financial
services sector (NOS, 2018). This sector is rapidly changing because of two main factors,
technology and laws and regulations (PwC, n.d.). For example, Fintech and data analytics are
receiving greater attention. Yet, simultaneously the size and impact of financial-economical
criminality is increasing (PwC, n.d.). Zooming in on ING in particular, the company was
founded in 1991 through the merger of Nationale-Nederlanden and NMB Postbank (ING,
n.d.a). The company has over 53,000 employees and operates in more than 40 countries (ING,
n.d.b).
Coming back to the case at hand, as noted previously, ING is not the only Dutch bank
who failed to counteract money laundering. For example, Rabobank received a fine of one
million euros because they failed to document required data on their clients (Haegens, 2019).
Moreover, there is a realistic fear that these fines are only “the tip of the iceberg”, as Dutch
investigation services struggle to keep up with the high number of money laundering cases
(NU.nl, 2019). Clearly, there seems to be a structural issue within the Dutch banking sector, as
these scandals keep emerging. Yet, the ING case, as explained previously, is unique, as the
issue lies with top management, not employees. This paper therefore aims to address the
following question, which will be elaborated on in the theoretical framework and intervention:
Does an ethical intervention program focused on both top management and employees
prevent money laundering scandals at ING?
3
Money laundering at ING
Geert Compen u560443
Zoë Sedlářík u943593
Anne Zijlmans u626382
Lecturer: Reneé De Reuver
9 December 2019
1
, Introduction
In recent years, banks have regularly failed when it comes to money laundering (NU.nl, 2019).
One of the most recent failures is ING. Near the end of 2018, they paid an immense settlement
of 775 million euros to the Dutch public prosecutor (Vogel, 2018). Recently it was announced
that their case will not only be prosecuted in the Netherlands (Driessen, 2019), but also in Italy
(Kreling, 2019), and Belgium (De Telegraaf, 2019a). As a result, the case is not closed yet, and
continues to have a major impact on the company. The ING case distinguishes itself from others
as only top management is involved with money laundering and this results in a performance
management issue (BNN VARA, 2019). Indicators for this performance management issue are,
amongst others, the resignation of the financial director (Kleinnijenhuis, 2018), the elimination
of employees’ bonuses (Koenis, 2019), and the need to recruit inexperienced employees and
retraining (NOS Nieuws, 2019).
This paper aims for a thorough analysis of the performance consequences for ING due
to money laundering. It provides an advisory performance management intervention to increase
overall performance and to prevent this issue in the future.
2
, Case description & analysis
In order to be able to analyze what went wrong at ING and to learn how to prevent future
occurrences of money laundering, it is crucial to gain a better understanding of the company
and the sector it operates in. Starting with the sector, as a bank, ING is part of the financial
services sector (NOS, 2018). This sector is rapidly changing because of two main factors,
technology and laws and regulations (PwC, n.d.). For example, Fintech and data analytics are
receiving greater attention. Yet, simultaneously the size and impact of financial-economical
criminality is increasing (PwC, n.d.). Zooming in on ING in particular, the company was
founded in 1991 through the merger of Nationale-Nederlanden and NMB Postbank (ING,
n.d.a). The company has over 53,000 employees and operates in more than 40 countries (ING,
n.d.b).
Coming back to the case at hand, as noted previously, ING is not the only Dutch bank
who failed to counteract money laundering. For example, Rabobank received a fine of one
million euros because they failed to document required data on their clients (Haegens, 2019).
Moreover, there is a realistic fear that these fines are only “the tip of the iceberg”, as Dutch
investigation services struggle to keep up with the high number of money laundering cases
(NU.nl, 2019). Clearly, there seems to be a structural issue within the Dutch banking sector, as
these scandals keep emerging. Yet, the ING case, as explained previously, is unique, as the
issue lies with top management, not employees. This paper therefore aims to address the
following question, which will be elaborated on in the theoretical framework and intervention:
Does an ethical intervention program focused on both top management and employees
prevent money laundering scandals at ING?
3
