The Hong Kong Monetary Authority (HKMA) announced today that it had completed an investigation and disciplinary proceedings for China CITIC Bank International Limited (CITIC) under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Chapter 615 of the Laws of Hong Kong) (AMLO).
The Authority has imposed a pecuniary penalty of HK$4,000,000 against CITIC for contraventions of the AMLO.
The disciplinary action follows an investigation by the HKMA on CITIC’s systems and controls for compliance with the AMLO. The deficiencies identified in the investigation were related to the incorrect implementation of detection rules and core model rules in its automated transaction monitoring system, resulting in failure to generate system alerts on suspicious transactions during the period between November 2015 and July 2018.
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.
In deciding the disciplinary action, the regulator has taken into account all relevant circumstances and factors, including the seriousness of the investigation findings, as well as the fact that CITIC has taken remedial actions to address the identified deficiencies; and CITIC’s lack of previous disciplinary record in relation to the AMLO.
