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Hungarian Erste Bank Wrongfully ‘Sanctions’ Russian and Belarusian Clients

Hungary Today 2022.05.26.

Erste Bank Hungary has terminated the bank account contracts of several Russian and Belarusian citizens. The bank is investigating the situation and clients complaints are being processed, Telex reports.

This article was originally published on our sister-site, Ungarn Heute. 

Erste Bank acknowledged that there had been mixups when it suspended the account services of several Russian and Belarusian customers, but said it would withdraw the wrongful terminations. Twenty of the 300 affected cleints may have been unfairly punished, and in one-third of the complaints, the error has already been corrected, Telex reports. The portal learned of the situation through a customer who had been wrongfully subject to sanctions.

Under the EU’s sanctions against Russia, deposits over EUR 100,000 from the country’s citizens or natural persons residing in Russia or from legal entities, organizations or institutions based in Russia are prohibited – but this rule does not apply to natural persons with temporary or permanent residence permits in Hungary.

Compensation Payments Begin as Hungarian Subsidiary of Russia's Sberbank Closes
Compensation Payments Begin as Hungarian Subsidiary of Russia's Sberbank Closes

A few tens of thousands of clients are affected by the bank's closure, including around 16,000 businesses, of which around six thousand have accounts with Sberbank alone.Continue reading

Erste Bank told Telex that of the bank’s more than 2,500 Russian clients affected by the regulation, which came into force in April, only slightly more than 300 are affected by the regulation. The bank has tried to inform these clients through various channels (personal approach, letters, etc.) that they can continue to hold their accounts only if they can prove their citizenship, temporary or permanent residence in an EU or EEA member state or Switzerland.

“Of the 300 customers, more than 20 complained to the bank about an administrative error in this affair. Although these customers had submitted the appropriate documentation, they were still sent the automatic termination notice. The bank’s complaint procedure will investigate the cases and reinstate the accounts in those situations where the termination was unjustified – this has already been done in a third of the cases.”

Featured photo illustration by József Balaton/MTVA


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