Poland Sees Surge in Banking Sector Fraud Cases Involving Foreigners

Alarming Increase in Fraudulent Activities

The Polish banking sector has witnessed an alarming increase in fraudulent activities perpetrated by foreigners using Polish companies and bank accounts. According to Jarosław Kruk, an attorney at law and managing partner, the majority of these crimes involve offshore companies or those with offshore participation.

Improved Anti-Money Laundering Practices Not Enough

While Polish banks have improved their anti-money laundering practices in recent years, making it virtually impossible for offshore entities to establish accounts, foreign companies still find ways to exploit the system. Banks are now reluctant to open accounts for EU companies, especially new ones, and instead require them to set up a branch in Poland or register as a beneficial owner.

Methods Used by Fraudsters

Fraudsters often target Polish banks by setting up shell companies with names similar to those of their victims, adding “Poland”, “Polska” or “CEE” to the name. Once the stolen money is deposited into these accounts, it is quickly transferred between personal accounts and cashed out.

Common Targets and Perpetrators

The most common targets of these frauds are companies in Western Europe, the US, and Canada, while perpetrators come from a variety of countries.

Current State of Labor Market and Regulations

However, with the current state of Poland’s labor market, there is little hope that regulations related to assigning PESEL numbers will be tightened or changed. Instead, experts believe that continuous improvements in bank anti-money laundering systems may offer some protection against these frauds.

New Deal Legislation Raises Concerns

The recent introduction of the “New Deal” legislation has also raised concerns about potential fraud and scams. The new law, which came into effect on January 1, 2022, is a complex and unclear piece of legislation that has been criticized for being sloppily written and contradictory to existing laws.

First Scams Emerge

In fact, the first scams have already emerged, with fraudsters impersonating social security officials on special hotlines and tricking people into revealing personal data and account passwords. The inventiveness of these scammers is staggering, and it’s easy to find victims among the elderly and infirm.

Government Responsibility

The Polish government has been accused of contributing to these losses by introducing poorly drafted legislation, and it remains to be seen whether they will take responsibility for their role in these frauds. As one lawyer noted, “our state appears to be a co-conspirator or, from a civil law perspective, a contributor to the harm.”