A year ago, the National Bank of Ukraine decided to liquidate Concorde, one of the most technologically advanced and profitable Ukrainian banks. This decision stirred up the Ukrainian banking sector as it set a precedent. Before that, there had been no examples of liquidation of a working and, most importantly, profitable financial institution, UNN writes.
"It has been exactly one year since we lost our bank. I have lived this year as if in a fog of injustice and misunderstanding. Gradually, I am coming to realize that this technologically advanced structure, one of the best on the market, was destroyed by the will of a few people. I still can't understand the reason for this decision and it hurts a lot," Olena Sosedka, co-founder of Concord Fintech Solutions, wrote .
The decision to revoke Concorde's banking license was made by the NBU Board on August 1, 2023. After that, the bank's liquidator was appointed by the Deposit Guarantee Fund.
The reason for this decision was the bank's alleged systematic violation of the requirements of the legislation on prevention and counteraction to legalization (laundering) of proceeds from crime, terrorist financing and financing of proliferation of weapons of mass destruction.
Although, as it turned out later, even state-owned banks, including Ukrgasbank, are engaged in misdirection (changing the purpose of payment in a bank acquiring network, usually related to gambling operations) in Ukraine. However, the NBU fined it only UAH 60 million for this violation. The same as Oschadbank, Sense Bank, FUIB, and many others over the past year. They also received fines ranging from UAH 150 million to UAH 10 million.
However, Concord, which had not had any comments from Mastercard and Visa during its operation, was deprived of its banking license. And this is despite the fact that 8 months before the NBU's decision to revoke its banking license, Concorde had shut down its acquiring services. After that, the bank continued to be profitable, which showed that it was not dependent on miscoding - it was not the main part of its income.
"We believe that the penalty does not correspond to the actual circumstances and, in any case, did not correspond to the penalties for other banks in similar cases. Why do we think so? Because, for example, Ukrgasbank has a fine of UAH 60 million, Sense Bank - UAH 60 million, FUIB - UAH 10 million, and we were deprived of our license. I would like to note that the volume of transactions in the mentioned banks is incomparably higher - according to some estimates, ConcordBank served no more than 20% of the entire online casino market. However, I would like to emphasize that I do not evaluate the regulator's actions in terms of legality - this will be decided in court," Sosedka told after the NBU's decision to liquidate the bank.
Concorde's shareholders filed a lawsuit against the NBU's actions, and the first instance court sided with them. In particular, the Dnipropetrovs'k District Administrative Court declared unlawful and canceled the decision of the National Bank of Ukraine to revoke the license and liquidate Concord Bank.
However, Ukrainian legislation is written in such a way that even after a final court decision on the illegality of the bank's license revocation, it is impossible to return it to the market - there are no mechanisms for this.
Lawyers interviewed by UNN, notethat the maximum that the owners of a bank that was illegally withdrawn from the market can expect is to bring to justice the NBU officials who made the decision and compensation for damages.
Concord is currently in the process of liquidation. The Deposit Guarantee Fund continues to pay off depositors and creditors of the bank and sell its property. In particular, the 9th line of the register of accepted claims of Concorde's creditors has already received its funds.
According to the bank's shareholders, such a quick settlement was possible because the bank was profitable and had enough funds on its accounts to complete the liquidation process.
After the NBU's decision was made, the State Tax Service began to inspect Concorde's activities. The first audit lasted three months and resulted in a report for UAH 700 thousand.
According to Olena Sosiedka, "on the personal instruction of the head of the Verkhovna Rada Tax Committee, Danylo Hetmantsev, UAH 392 million was illegally added to this act." The DGF, represented by the bank's liquidator, disagreed with this audit report and filed its objections. After that, an additional audit was ordered, which is still ongoing.
During this time, according to Olena Sosiedka, the bank's team has been implementing other projects. In particular, the DobroDiy Charity Exchange founded by Olena and Yulia Sosedka, which primarily helps seriously ill children, continued its work. In addition, the shareholders continue to fight and defend their rights in court.
"It makes me happy that our team is finding themselves in other projects and looking for new roles. Despite this, we continue to fight for justice and try to understand what really happened. Out of all nine banks that were engaged in acquiring, only one suffered - Concord, although its turnover was not the largest," said Sosedka.
She does not rule out that this may be due to the fact that Concorde was successfully managed by women, while the decision to liquidate the profitable bank was made by men at the NBU.
The co-owner of the bank also emphasized that the fight for justice in relation to Concorde will continue. "We will continue to move forward and look for answers to restore justice and overcome this difficult time," summarized Olena Sosiedka.
Recall
Despite the war in Ukraine, the process of removing banks from the market has not stopped. Thus, as of February 24, 2022, the liquidation process was initiated against 8 banks. Last year, for the first time in Ukraine, not only bankrupt banks but also profitable institutions were subject to liquidation and license revocation, including Concord Bank. The process of depriving a banking institution of its license takes place without a court. Of course, the owners and shareholders of banks can appeal the decision of the regulator, the NBU, after it has made the decision to liquidate the bank, but in general, the process of removing a banking institution from the market, once it has been launched, is irreversible.
In addition, the issue of liquidation of a profitable bank is not regulated in Ukraine. According to Olena Sosedka, co-owner of Concord Bank, when the regulator announced the decision to liquidate the bank, the financial institution had enough highly liquid assets to make all the necessary payments in 2-3 weeks. But the process of bank liquidation is strictly regulated by law and can generally take up to three years.