DBS Unit Fined in Hong Kong for Money Laundering Violations
DBS Group Holdings’ Hong Kong unit has been fined HK$10 million (S$1.7 million) by the city’s regulator for lapses in adhering to anti-money laundering and counter-terrorist financing regulations.
The disciplinary action follows an investigation by the Hong Kong Monetary Authority (HKMA) into DBS Hong Kong’s systems and controls for compliance. The lapses occurred between April 2012 and April 2019, according to a statement from the regulator.
A spokesperson for DBS Hong Kong stated that the bank takes its anti-money laundering obligations “seriously” and accepts the HKMA’s decision, describing the issues as “sporadic and historical in nature.” Over the years, the Hong Kong unit has implemented new group policies and improved its capabilities to detect and mitigate money laundering risks, the spokesperson added.
Although the fine is relatively small, it represents another blemish for Singapore’s largest bank, which is already entangled in a money laundering scandal in its home city-state. In this case, more than S$3 billion (US$2.2 billion) of assets have been frozen or seized by the police, and DBS has significant exposure through funds held in its accounts and loans made.
Hong Kong authorities identified several failures, including the continuous monitoring of business relationships and the conduct of enhanced due diligence in high-risk situations. The bank also failed to maintain records on some customers, according to the regulator.
One notable lapse included the failure to obtain copies of identity documents for 609 authorizers of IDEAL, a corporate internet banking service provided by the bank. No identity verification was conducted against these authorizers from April 2012 to July 2017, the HKMA reported.
