The National Bank of Ukraine has only fined the state-owned Ukrgasbank and a number of commercial banks for misdirection, while the regulator has revoked Concord's license for the same violations. This was stated by Olena Sosedka, co-founder of JSC Concorde Bank, according to UNN.
She reminded that in February last year, the NBU inspected a number of Ukrainian banks regarding their work in the field of e-commerce. The regulator suspected that several private banks, as well as one state-owned bank, provided gambling business with high-risk transactions with the MCC 7994 code, but should have used MCC 7995 (i.e., "miscoding").
"As soon as the NBU started conducting inspections, Concord Bank, like all other banks, immediately closed all Internet terminals with the MSS 7994 code, without understanding where there were sales of gaming paraphernalia and where there was possible abuse by merchants," Olena Sosedka wrote on her Facebook page.
At the time, the media reported that 50-70% of all gambling operations belonged to the state-owned Ukrgasbank.
"However, the NBU decided to fine it only UAH 64.6 million. This means that the state-owned bank got away with a small fine and the dismissal of Andriy Kravets, the Chairman of the Board of Ukrgasbank, "for health reasons". The deputy chairman of the board, who was in charge of e-commerce, Serhiy Haritych, was fired a month and a half later. The NBU then decided that the bank had violated the Law of Ukraine "On Prevention and Counteraction to Legalization (Laundering) of the Proceeds of Crime, Terrorist Financing and Financing of the Proliferation of Weapons of Mass Destruction" and the NBU Board Resolution of May 19, 2020 "On Approval of the Regulation on Monitoring by Banks". Thus, the issue was resolved quietly and without much interference from the NBU. Perhaps this soft approach was due to the fact that it is a state-owned bank?" - recalled the co-founder of Concorde.
In addition, she said, other banks were also punished with monetary fines. In particular, Sense Bank paid almost UAH 50 million and was later nationalized, FUIB was fined UAH 10 million for the same violations as Ukrgasbank. KIB Bank received a fine of UAH 150 million, Oxi Bank - UAH 20 million, and MTB - UAH 10 million.
"We still don't understand why the NBU decided to apply the most severe measure to Concorde - revocation of its license for the same actions. This is despite the fact that Concord Bank sent a significant part of its profits to help the Armed Forces of Ukraine," said Olena Sosedka.
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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, owners and shareholders of banks may appeal against the decision of the regulator, the NBU, after it has made a decision to liquidate the bank, but in general, the process of withdrawing a banking institution from the market, once it has been launched, is irreversible.
In addition, the issue of liquidation of a profitable bank has not been regulated in Ukraine. According to Olena Sosedka, co-owner of Concord Bank, at the time 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.