The Hong Kong Monetary Authority (HKMA) has fined China CITIC Bank International Limited (CITIC) HK$4 million for breaches of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), it was revealed Friday.
Hong Kong Monetary Authority Fines China CITIC Bank HK$4M
The regulator said the penalty comes after an investigation into deficiencies in CITIC’s transaction monitoring systems between November 2015 and July 2018.
The HKMA found that CITIC’s automated transaction monitoring system had failed to generate alerts for suspicious transactions due to errors in detection and core model rules.
Additionally, they state that CITIC also failed to examine the background and purpose of the transactions of some customers and to set out its findings in writing during this period.
Raymond Chan, Executive Director (Enforcement and AML) at the HKMA, said: “The integrity and robustness of a transaction monitoring system is vital in the ongoing fight against financial crime. It is important for banks to ensure that their transaction monitoring system is properly configured and operates effectively.”
The HKMA acknowledged CITIC’s remedial actions to address the deficiencies and noted that the bank cooperated fully with the investigation.
The regulator also said that in deciding the disciplinary action it felt it needed “to send a clear deterrent message to CITIC and the industry about the importance of having effective controls and procedures to address money laundering and terrorist financing risks.”
However, they also noted that CITIC also has no prior disciplinary record under the AMLO.
