The Office of the Commissioner of Financial Institutions of Puerto Rico ordered Banex International Bank to cease operations immediately, revoked its international financial entity license and appointed Driven, P.S.C. as receiver to administer and liquidate the institution. The regulator determined that Banex is insolvent and lacks the capital and liquidity needed to operate safely or meet its obligations to depositors. An independent compliance monitor found serious financial, operational, accounting and control deficiencies. More than USD 24 million recorded as funds “In Transit” could not be located, traced or confirmed, while more than USD 18 million was owed by Banex’s sole shareholder and related entities without adequate repayment arrangements or, for a substantial portion, a reasonable expectation of recovery. Banex’s condition deteriorated after U.K. authorities intervened in related entity Euro Exchange Securities UK Ltd., leaving Banex funds frozen or inaccessible. Banex must stop accepting deposits and conducting transfers, payments, withdrawals or other disbursements unless authorized by the receiver. It is also barred from disposing of assets or representing itself as a licensed international financial entity. The regulator has proposed fines totaling USD 534,000, which remain subject to administrative proceedings, while the cease and desist measures and license revocation remain in force during any challenge.

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