Luxembourg's state-owned bank is fined €5 million following the €61.2 million Caritas fraud.

It has been reported that Luxembourg's state-owned bank Spuerkeess (Banque et Caisse d’Épargne de l'État) has been fined nearly €5 million by the Financial Sector Supervisory Commission (CSSF) due to serious deficiencies in its anti-money laundering (AML) and counter-terrorist financing (CFT) controls.

Key Details:

• Fine Amount: €4,968,780 (less than 0.5% of Spuerkeess’s 2023 turnover).
• Context: The penalty is linked to the Caritas affair, a major fraud case where €61.2 million was misappropriated via thousands of bank transfers.
• Findings:
• Inadequate configuration of suspicious transaction detection tools;
• Poor analysis of atypical movements, massive simultaneous transfers;
• Weak monitoring of institutional and non-profit clients; and
• Insufficient handling of relationships with high-risk countries.
• Timeline:
• CSSF had previously issued an injunction in 2018;
• The latest investigation ran from August to December 2024; and
• The fine was officially imposed on 2 May 2025 and made public on 30 July 2025.

Additional Notes:

• BGL BNP Paribas, also investigated, was cleared of wrongdoing; and
• CSSF emphasised that the fine does not imply direct responsibility of Spuerkeess in THE CARITAS FRAUD but rather reflects failures in compliance and due diligence.

THE CARITAS FRAUD

The Caritas fund misappropriation case is one of the most significant financial scandals to hit Luxembourg’s charitable sector, involving the loss of €61.2 million through a sophisticated fraud scheme.

🔍 Overview of the Scandal:

• Victim: Caritas Luxembourg, a major Catholic charity known for international humanitarian aid.
• Amount Misappropriated: €61.2 million — equivalent to its entire annual budget.
• Method: A “fake president” scam (also known as CEO fraud), where fraudsters impersonated senior executives to authorise urgent payments.
• Execution:
• Over 8,200 transactions were made in rapid succession;
• Funds were transferred to accounts in Spain, China, Hong Kong, Lithuania, and other countries; and
• The scam bypassed standard authorisation procedures, exploiting internal trust and weak controls.

🏦 Banking Involvement:

• Caritas used Spuerkeess and BGL BNP Paribas for its banking operations.
• The CSSF fined Spuerkeess nearly €5 million for:
• Failing to detect suspicious patterns;
• Weak transaction monitoring; and
• Inadequate scrutiny of beneficial ownership and fund sources.
• BGL BNP Paribas was investigated but not fined.

References

Caritas Scandal: A Potent Cocktail of Misplaced Trust https://citynews.lu/2025/07/31/caritas-scandal-a-potent-cocktail-of-misplaced-trust/

Spuerkeess Fined Almost €5m for Caritas Payment Failings https://chronicle.lu/category/charity-volunteering/56121-spuerkeess-fined-almost-eur5m-for-caritas-payment-failings

Caritas: CSSF imposes €5m fine on Spuerkeess https://en.paperjam.lu/article/caritas-cssf-eu5m-fine-for-spuerkeess

Spuerkeess fined almost €5 million by financial sector watchdog https://today.rtl.lu/news/luxembourg/a/2325258.html