Monetary Authority takes disciplinary action against Westpac Banking Corporation, Hong Kong Branch for contraventions of Anti-Money Laundering and Counter-Terrorist Financing Ordinance
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The Hong Kong Monetary Authority (HKMA) announced today (January 31) that it had completed an investigation and disciplinary proceedings for Westpac Banking Corporation, Hong Kong Branch (WBCHK) under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Chapter 615 of the Laws of Hong Kong) (AMLO) (Note 1). The Monetary Authority (MA) has imposed a pecuniary penalty of HK$4,000,000 against WBCHK for contraventions of the AMLO.
The disciplinary action (Note 2) follows an investigation by the HKMA on WBCHK's systems and controls for compliance with the AMLO. The control lapses identified in the investigation relate to its delay in completing periodic reviews for some of its customers during the period between June 1, 2016, and May 31, 2017. WBCHK also failed to establish and maintain effective procedures for carrying out its duties under the AMLO in relation to periodic reviews for its customers during this period.
In deciding the disciplinary action, the MA took into account all relevant circumstances and factors, including the following:
- the seriousness of the investigation findings;
- the need to send a clear deterrent message to WBCHK and the industry about the importance of effective controls and procedures to address money laundering and terrorist financing risks;
- WBCHK has rectified the deficiencies identified; and
- WBCHK has no previous disciplinary record in relation to the AMLO and cooperated with the HKMA during the investigation and enforcement proceedings.
The Executive Director (Enforcement and AML) of the HKMA, Ms Carmen Chu, said, "Timely periodic reviews for customers is a vital part of effective framework for banks to help combat money laundering and financial crime. Banks should maintain up-to-date understanding of risks and deploy adequate resources to detect and deter abuse of accounts, and thus contributing to the ecosystem response to evolving threats and upholding the integrity of banking system. Reference can be made to the HKMA's relevant guidance to ensure systems of controls remain effective and risk-based."
Note 1: Prior to March 1, 2018, the short title of Chapter 615 of the Laws of Hong Kong was the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance.
Note 2: The disciplinary action is taken under section 21 of the AMLO. The AMLO imposes customer due diligence and record-keeping requirements on specified financial institutions, including Authorized Institutions, and designated non-financial businesses and professions. As regards Authorized Institutions, the MA is the relevant authority under the AMLO.
Ends/Tuesday, January 31, 2023
Issued at HKT 16:30
Issued at HKT 16:30
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