Hong Kong: HKMA Imposes HK$9 Million Penalty on Hua Nan Commercial Bank for AML Breaches

The Hong Kong Monetary Authority imposed a pecuniary penalty of HK$9,000,000 on Hua Nan Commercial Bank, Ltd., Hong Kong Branch on 19 April 2024 for contraventions of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, the regulator announced in a press release published on its website that day. The penalty followed an HKMA investigation into the adequacy of the bank's anti-money laundering and counter-terrorist financing controls.

The HKMA's enforcement action found that Hua Nan Commercial Bank Hong Kong had contravened the requirements prescribed under the AMLO, the principal legislative framework governing AML and CFT obligations for authorised institutions in the city. The HKMA found that between April 2012 and July 2018 the branch failed to continuously monitor business relationships with some customers and to maintain effective procedures for doing so, and that between 1 March and 9 July 2018 it failed to record or include recipients' names in a number of cross-border outgoing wire transfers.

FACTORS CONSIDERED IN SETTING THE PENALTY

In setting the penalty, the HKMA took into account that the bank had self-identified and proactively reported the deficiencies, had taken remedial measures and had no previous disciplinary record under the AMLO. The authority found the branch's controls fell short of the requirements of the AMLO.

Hua Nan Commercial Bank is a Taiwan-headquartered institution with a branch presence in Hong Kong.