HSBC has been hit with a £64m fine and sharply criticised by UK regulators for “serious weaknesses” in its anti money laundering controls over an eight-year period.
The Financial Conduct Authority said that, between March 2010 and March 2018, HSBC had a string of AML failures. They included not properly considering the scenarios it was using to pick up the risk of suspicious activity, not testing and updating its systems that flagged suspicious activity, and not checking the accuracy and completeness of the data it was gathering for AML checks.
“HSBC’s transaction monitoring systems were not effective for a prolonged period despite the issue being highlighted on numerous occasions,” said Mark Steward, executive director of enforcement and market oversight at the FCA.
“These failings are unacceptable and exposed the bank and community to avoidable risks, especially as the remediation took such a long time. HSBC continued their remediation to address these weaknesses after the relevant period.”
The fine would have been just over £91m without a 30 per cent discount for early settlement.
In a statement, HSBC said it had “initiated a large-scale remediation of its financial crime control capabilities” in 2012. “More recently, as the FCA recognised, HSBC has made significant investments in new and market-leading technologies that go beyond the traditional approach to transaction monitoring. HSBC is deeply committed to combating financial crime and protecting the integrity of the global financial system.”