HKMA issue warning to Hong Kong Banks on Anti-Money Laundering measures

The Deputy Chief Executive of the Hong Kong Monetary Authority, Mr. Arthur Yuen, announced today that some banks in Hong Kong may have failed to meet anti- money laundering (AML) requirements. Mr. Yuen has said that the time has come for tougher enforcement of Hong Kong’s Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance, Cap 615 which came into force on 1st April 2012. 2 major problems were identified by the HKMA investigations as follows:

  1. The systems they have in place for KYC background checks on clients; and
  2. The maintenance of a good record-keeping system to monitor suspicious transactions for reporting to the Joint Financial Intelligence Unit.

The HKMA can directly impose penalties for breaches of the anti-money laundering law, without any formal prosecution through the Hong Kong courts. These penalties include remedy orders for banks to improve their system, a public reprimand, or a fine up to HK$10 million for each breach.