DBS HK fined US$1.28m for anti-money laundering, review lapses

The bank failed to conduct due diligence in ‘high risk situations’ from 2012 and 2019.

The Hong Kong Monetary Authority (HKMA) is fining DBS HK$10m (approximately US$1.28m; S$1.73m) for contraventions against its anti-money laundering and counter-terrorist financing ordinance (AMLO).

Authorities found control deficiencies in DBS Hong Kong, notably its failure to continuously monitor business relationships and conduct enhanced due diligence in high-risk situations during various periods between April 2012 and April 2019, the HKMA said in a statement posted on its website.

DBS Hong Kong also reportedly failed to keep records in respect of some of the customers. 

Notably, DBS failed to duly complete the trigger event review of a customer, which resulted in 23 customers’ documents, data, and information not being relevant or up to date for a prolonged period of time.

DBS also reportedly failed to obtain copies of the identity document of 609 IDEAL2 Authorizers– individuals authorized by the customer to approve transactions and considered a person purporting to act on behalf of the customer. These authorizers were registered by 477 corporate customers on or before 30 July 2017, and DBS reportedly did no identity verification on these authorizers from 1 April 2012 to 30 July 2017. 

DBS Hong Kong also failed to maintain effective procedures for carrying out its duties under the AMLO in relation to the aforementioned control deficiencies during this period, according to Hong Kong authorities.

Prior to this, DBS Hong Kong had no previous disciplinary record in relation to the AMLO.

The bank was said to have cooperated with the HKMA during the investigation and enforcement proceedings.

(HK$1 = US$0.13 = S$1.72)