RegTech

South African Prudential Authority Fines HSBC $1.04m for Money Laundering

  HSBC has been hit with a financial penalty of ZAR 15 million ($1.04 million) due to “certain weaknesses” in its detection of potential money laundering and the financing of terrorism.

The South African Prudential Authority, operating within the South African Reserve Bank (SARB), imposed the fine, of which ZAR 7.5 million ($522,000) is suspended in terms of section 45C(4)(c) of the Financial Intelligence Centre Act 38 of 2001 (FIC Act) for a period of three years, subject to HSBC adhering to certain money laundering conditions.

SARB says the money laundering weaknesses were identified in HSBC’s processes, and which inhibited the bank from proactively detecting issues.

Anti Money Laundering
Mr K Naidoo
Deputy Governor and CEO: Prudential Authority

There were no more details and the fine is not huge, but it’s a wake up call to the bank. In other bad news for the bank, cyber attackers recently got hold of customer data belonging to HSBC Bank USA.

According to a “notice of data breach” sent to affected customers on 2 November, HSBC Bank USA said a number of online accounts were accessed by unauthorised users between 4 October 2018 and 14 October 2018.

 

You may also read: Obtaining Credit through Any Means is not Taboo – Adesemowo, CTO, Social Lender

 

Other banks have come under fire for their lax money laundering controls.

For example, Danske Bank is being investigated due to the €200 billion money laundering case in Estonia.

In September, ING was fined €775 million by the Dutch Public Prosecution Service (DPPS) for its lapses.

Back in February, US Bancorp, the parent company of US Bank, was hit by a $613 million penalty for failing to monitor suspicious transactions and other anti-money laundering (AML) activities.