HSBC fined US$85 million by UK regulator for anti-money-laundering lapses

The Financial Conduct Authority said three key parts of HSBC’s automatic monitoring system had serious weakness over an eight-year period until March 2018

HSBC’s London-traded shares fell 0.5 per cent to 446.10 pence after the UK watchdog’s announcement

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HSBC has been penalised for anti-money-laundering lapses in the UK. Photo: Sam Tsang

Published: 6:04pm, 17 Dec 2021Updated: 7:53pm, 17 Dec 2021

Britain’s regulator has fined HSBC £63.95 million (US$85.16 million) for failing to follow anti-money-laundering processes.

The Financial Conduct Authority (FCA) found three key parts of HSBC’s automatic monitoring system in the United Kingdom had serious weakness over an eight-year period until March 2018, the regulator said in a statement on Friday.

HSBC was given a 30 per cent discount on the £91.35 million fine as it did not dispute the findings and agreed to settle at the earliest, the FCA said.

“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.

Mark Steward, executive director of enforcement and market oversight at the Financial Conduct Authority, pictured in August 2015. Photo: May Tse

“These failings are unacceptable and exposed the bank and the community to avoidable risks, especially as the remediation took such a long time,” said Steward, a former head of enforcement at Hong Kong’s Securities and Futures Commission. The bank has made improvements since 2018, he added.

Steward said the enforcement was related to HSBC’s compliance with UK laws and was not related to the US Department of Justice decision in 2012.

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