Three years after a financial crisis that left its banking system in disarray, Cyprus has been rapidly revoking corporate charters in an effort to satisfy intergovernmental bailout demands. The island-nation, which in 2011 exacted funds from wealthy depositors in an effort to keep its financial sector afloat, has excised approximately 48,000 corporate entities once listed in its Companies Registrar, according to Cypriot authorities. The clean-up comes at the behest of the European Union and International Monetary Fund, which agreed in 2012 to a 10-billion euro bailout package for Cyprus. The sum represents an 18 percent drop from the total 270,000...
Whatever the effectiveness of sanctions meant to sway Russia's involvement in Ukraine, one thing is certain: they've worsened the country's capital flight problem. By year's end, approximately $128 billion will have moved abroad, up from $63 billion in 2013, according to Russia's central bank.
The terms of an ongoing audit of Cyprus' financial sector and a recent exodus of funds will significantly hinder attempts to identify dirty money with ties to the island-nation, say compliance experts.
The bank returned its banking license on Jan. 18, three months after the U.S. Justice Department sued the Bank of Cyprus over claims that it aided a Cypriot fugitive launder proceeds from an insider trading scheme.
The fallout from the securities fraud and anti-money laundering case involving the two institutions may continue, suggest compliance consultants, who say financial institutions involved in correspondent transactions with the defendants may face pressure from regulators and law enforcement.