Austria's Financial Market Authority, the FMA, imposed a financial penalty of EUR 791,000 — equivalent to approximately $880,000 — on Hypo Vorarlberg Bank AG, published in August 2024, for failures in its due diligence obligations under anti-money laundering and counter-terrorist financing rules. The sanction was published by the regulator in line with its standard practice of making enforcement actions publicly available, and was described in Austrian press as a record AML penalty.
Hypo Vorarlberg Bank AG is a regional lender headquartered in Bregenz, the capital of the Vorarlberg province in western Austria. The bank serves retail and corporate clients across the region.
DUE DILIGENCE FAILURES
The penalty relates to shortcomings in the bank's customer due diligence processes. Due diligence obligations require banks to verify customer identities, understand the nature and purpose of business relationships, and monitor transactions on an ongoing basis to identify suspicious activity.
Reports linked the case to accounts held with a correspondent bank, a relationship Hypo Vorarlberg said it had ended in 2019.
BANK TO APPEAL
The penalty was not final: Hypo Vorarlberg said it believed it had complied with all legal requirements and would appeal to the Federal Administrative Court.