Good news for the 6.500 bank customers with deposits held at FBME Bank Ltd – Cyprus branch. Dinos Christofides, Special Administrator of FBME Bank Ltd (Cyprus Branch), starts allowing bank customers to issue a check on their own behalf. Until further notice these bank checks can only be collected in person and must be deposited on the bank account of the beneficiary in Cyprus. This bank account must have the exact name and credentials as the account held at FBME Bank.
The U.S. Financial Crime Enforcement Network, a division of the US Treasury, described FBME as “a primary money laundering concern” with ties to Hezbollah and ordered U.S. banks to refrain from opening or maintaining correspondent accounts with it. The bank denies the allegations and will contest FinCEN’s decision in U.S. court.
Customers of FBME Bank Cyprus often live abroad and can hire external expertise to guide them through the processes. It is inevitable that customers visit Cyprus at least once. Further steps in the recovery process can be outsourced to Legal Floris LLC.
Update
As of the first of December 2015 no checks are issued anymore. It is expected that funding for the check route by FBME Bank Ltd. was stopped. Further procedures to recover funds from bank accounts will follow at a later stage.
Since the banks license was taken by the central bank of Cyprus on the 21st of December 2015, the deposit guarantee scheme for customers with deposits held at FBME Bank Ltd – Cyprus branch is opened in April 2016. Bank customers must visit Cyprus to file their claim.
As of early September 2016, the DGS paid out 29 million to FBME Bank customers. The DGS is an external insurance guarantee where FBME Bank Cyprus already paid its premiums for. Most accounts are eligable to receive compensation for the account balance at FBME Bank, Cyprus branch.