On December 17, Britain’s financial regulator said that it had fined HSBC (HSBA.L) 63.95 million pounds ($85.16 million) for failing in its anti-money laundering (AML) processes.
The Financial Conduct Authority (FCA) found that for eight years from 31 March 2010 to 31 March 2018, three key parts of HSBC’s transaction monitoring systems showed serious weaknesses.
A string of failings including inadequate monitoring of money laundering and terrorist financing scenarios until 2014, and poor risk assessment of “new scenarios” after 2016 had been made by HSBC, according to the regulator.
Not only did HSBC not check the accuracy and completeness of data in monitoring systems, it was also found to have had inappropriate testing. Executive director at the FCA, Mark Steward, said:
“These failings are unacceptable and exposed the bank and community to avoidable risks, especially as the remediation took such a long time.”
The regulator said that HSBC’s penalty was deducted from 91 million pounds seeing that it did not dispute the findings. In a statement, a HSBC spokesperson said:
“We are pleased to resolve this matter, which relates to HSBC’s legacy anti-money laundering systems and controls in the UK. HSBC is deeply committed to combating financial crime and protecting the integrity of the global financial system.”
($1 = 0.7509 pounds)