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MALTA’s FIAU fines HSBC €82,000 for AML breaches re transaction monitoring


The FIAU, Malta’s anti-money laundering unit, found the bank failed to adequately document the reason behind a €2 million transaction by one of its customers.

In an online notice,

The FIAU said that although the bank provided it with more detailed information about the business operations of the customer in question, HSBC did not back this up with invoices or any other supporting documentation for the transaction.

The FIAU said that in another breach, HSBC’s transaction monitoring system failed to flag various high-value transactions by one customer, which at times reached €800,000.

HSBC told the FIAU that although the rule in place at the time did not trigger any alerts on the transactions carried out by that particular customer, a “tuning exercise” took place and revised thresholds were put in place for the transaction monitoring system.

The FIAU said the bank also stated that other controls in place did lead it to scrutinise the transactions in question. The unit however noted that the previously established monetary thresholds to monitor large transactions passing through the accounts within a specific time period were too high, thus increasing the risk that certain large and anomalous transactions were not being captured and adequately scrutinised by the bank.

It was also noted how in three customer files, HSBC failed to gather the necessary documents to verify the identity or address of the beneficial owners or senior managing officials.

The FIAU said in determining the fine, it has taken HSBC’s “good level of cooperation” and positive dialogue throughout the years into consideration,  together with the regard that the bank has shown towards its anti-money laundering obligations.

HSBC’s “continuous investment” in its technical and human resources tasked with preventing and combatting money laundering has also been taken into consideration.

Over the past year, the courts have reduced several fines issued by the FIAU.

Last April, Corporate & Commercial FX Services Limited had a €156,000 FIAU fine slashed to €31,000 upon appeal.

The now-defunct Satabank had a €3.7 million fine reduced to €851,000.

To read the original article source click here



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