Hong Kong’s financial regulator has fined Bank of Communications (Hong Kong) and two other banks a combined HK$16.2 million for failures to continuously monitor business relationships with customers.
The Hong Kong Monetary Authority has imposed pecuniary penalties of HK$4 million on BCOM (HK) and HK$3.7 million on the Hong Kong branch of Bank of Communications (3328), as well as HK$8.5 million for the local branch of Indian Overseas Bank, according to a statement on Tuesday.
The HKMA has reprimanded IOBHK and ordered it to conduct a look-back review of past transactions and develop and implement a remedial plan to address the contraventions.
The contraventions of BCOM (HK) and BCOM Hong Kong branch arose from omissions to load certain types of transactions into the transaction monitoring system shared by the two banks, undermining the system's effectiveness in identifying potentially suspicious activities, the statement said.
The disciplinary actions follow investigations by the HKMA into the banks' systems and controls for compliance with the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, the regulator said, adding that the control deficiencies identified related to failures to establish and maintain effective procedures for continuously monitoring business relationships with customers.
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