Bank witness doesn't know; can't remember #BadBanki
Talk Liberation again travelled to Reykjavik to take on Islandsbanki in court. This time the bank was on the stand.
After a successful first hearing in June — this week, Talk Liberation were back on the ground in Iceland again, seeking answers in court. Icelandic media had caught wind of the unfolding #BadBanki scandal and were beginning to dig into why one of their own institutions was being sued for debanking us. (Catch up on their coverage here.)
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On Tuesday 2nd September our team, together with Wikileaks’ Icelandic lawyers, reconvened at the Reykjavik courthouse with expectations of seeing justice unfold. Earlier this year, Islandsbanki refused to testify until compelled to do so by the judge. This time, the bank produced their witness - a young bank lawyer - and the focus of the hearing was on their testimony. Unfortunately, more often the not the witness answered questions with “I don’t know” or “I can’t remember.”
John Kiriakou, former CIA whistleblower & Panquake Brand Ambassador, joined our Media Director Fiorella Isabel in Reykjavik, Iceland.
“I think it could not have gone better for Talk Liberation. There was only one witness today. He was an internal attorney for the bank and he was unable to even answer some of the most basic questions” - John Kiriakou, Talk Liberation Brand Ambassador
The bank’s representative appeared unprepared for many specific lines of inquiry, at least eight times responding with "I don't know" or "I don't remember,"
These non-answers came in regards to: the bank's efforts (or lack thereof) to engage with Talk Liberation during the process of freezing our accounts and debanking us; their compliance (or lack thereof) with broader Anti-Money Laundering (AML) regulations; his (lack of) knowledge of EU banking laws; and whether standard steps for seeking clarification were followed before taking the severe action of freezing our account.
“The Talk Liberation attorney asked him during questioning if he was acquainted with EU banking laws and he simply said no, he wasn’t. The fact of the matter is, even as an outsider I could see it - I’m not an attorney - I could see that Talk Liberation had the truth behind it, had documents behind it, had sworn testimony behind it. And the bank’s position was - well, trust us, that we did our best to follow the laws of Iceland.” - John Kiriakou, Talk Liberation Brand Ambassador
Here we list just several of the bank witness’s responses:
Question from the Judge: “Did the bank advise Talk Liberation what was happening?”
Bank witness answer: “I don’t remember”
Question from Talk Liberation’s attorney: “Did the bank look into the AML database?”
Bank witness answer: “I don’t know”
Question from Talk Liberation’s attorney: “Does the law require that a report go into the AML database?” [when an account is frozen]
Bank witness answer: “I don’t know”
Question from Talk Liberation’s attorney: “Did the bank consider whether Talk Liberation broke the law?”
Bank witness answer: “The bank has never accused Talk Liberation of a crime. The bank was doing due diligence. There are many reasons why a bank would decline business.”
Question from Talk Liberation’s attorney: “Are you familiar with EU banking laws?”
Bank witness answer: “No”
Question from Talk Liberation’s attorney: “Did the bank call the police?”
Bank witness answer: “I don’t know”
Question from Talk Liberation’s attorney: “Couldn’t you have just asked for answers to your questions?”
Bank witness answer: “We thought we had the answers we needed.”
Well, at least he showed up - but clearly, these are not the answers of someone that is well informed, whether intentionally or by circumstance. So then, what did the witness say that was of any relevance at all?
KYC & Beneficial Ownership
The bank's witness stated that an “unusually high sum” (our $1 million USD seed funding that was frozen) had triggered a mandatory Know Your Customer (KYC) review to confirm our beneficial ownership.
It is worth noting that in June, Talk Liberation founder Suzie Dawson testified that the bank itself didn’t even realise the funds had cleared in until Talk Liberation informed the bank that the money had been deposited into the account. The bank appeared to be none the wiser. In fact, Talk Liberation had twice informed the bank in writing that the transaction had occurred and that the money was sitting in our bank account, before the bank froze the funds with no notice.
With regards to the belated KYC procedure, the Islandsbanki witness stated that they encountered “discrepancies” regarding who ultimately controlled our company. Talk Liberation supplied the bank with a current Certificate of Incumbency (the correct document to provide in such a situation) that showed the shareholdings yet the bank refused to acknowledge the validity of the document.
Talk Liberation responded by voluntarily providing internal email communications to the bank to prove the provenance of the documentation; that it had been legitimately obtained and was not manipulated in any way, but the bank ignored this.
Talk Liberation repeatedly requested meetings with the bank and offered to facilitate connecting the bank with the regulatory authorities in their place of domecile, in order to confirm the authenticity of the documentation. The bank failed to accept Talk Liberation’s efforts to achieve resolution and instead closed Talk Liberation’s bank accounts permanently.
“Money not withheld”
In court, Islandsbanki painted a vastly different picture. They incredulously claimed to have never received the emails from Talk Liberation notifying them about the funds, claiming that the emails were sent to a “general” customer services inbox which was somehow not specific enough, although no other address or directive around communications had been provided to Talk Liberation.
Because their interpretation of the documentation was that it was somehow flawed, according to them, that legally obligated Islandsbanki to lock the accounts and then to cease the business relationship with Talk Liberation and have our services terminated. Meanwhile, the bank’s counsel was adamant that Talk Liberation’s funds were not withheld as “we could transfer them to another bank.”
Funnily enough, after our funds were frozen and we were debanked by Islandsbanki, no other bank in Iceland would provide services to us. Which leads us right back to the questions of what Islandsbanki wrote in the AML system, that the bank lawyer claims not to know anything about.
In the meantime, our Icelandic corporate attorneys tried to accept the offer from the bank to return our funds, providing their own lawyer’s trust account for the funds to be transferred into. But Islandsbanki refused to process the transaction, because the lawyers also banked with Islandsbanki. Creating a Catch-22 where they could claim willingness to return the funds while themselves obstructing the return of them.
Talk Liberation’s Icelandic attorney Sveinn Sveinsson later commented that the way the bank operated in court lacked transparency:
“That was not in their favor, they are not informing about the possible registration or suspicious activity registration on the Anti-Money Laundering database and they are saying that “we are not allowed to inform”, but they are of course allowed to inform if there is no such letter or no such registration or no such information in this database.
But this all comes to, as I was trying to emphasize, this system where the bank themselves are the rulers and they follow the rules, they implement the rules and there’s no such thing as transparency or the possibility of the client to protest or anything.
This is not a government body that is making decision, these are privately owned banks that make decisions and they rely on databases that are owned by privately owned companies” — Talk Liberation’s Icelandic attorney Sveinn Sveinsson
Unfortunately, the hearing left us with more questions than answers, following the witness’s testimony:
Did Islandsbanki have a valid suspicion around our company ownership, when it had in fact been provided with valid proof of ownership?
Was there an AML report submitted to the global AML database?
If so, are there unfounded accusations or suspicions ascribed to Talk Liberation in it, which caused other banks to shy away from doing business with us?
Who will keep the bank accountable, when it is answerable to no one but its internal procedures, which it refuses to produce or reveal - even in a court of law?
Under Icelandic law, only a judge can look into the AML records held by the banks — without which we will not know which information was recorded and therefore never really know the full story of what happened to us.
The judge is now expected to take four to six weeks to deliver a decision.
We will keep you informed of the outcome.
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Pretty scary that a representative from a major bank claims to not be familiar with EU law, among other things. "I don't know" is 100% unacceptable, and the judge should EASILY rule in Talk Liberation's favor.
Thank You TL