HSBC fined almost £64m for money laundering failures over 8 year period

HSBC has been hit with a fine of almost £64 million for failings in its anti-money laundering process.

The Financial Conduct Authority (FCA) said the banking giant used automated systems to monitor hundreds of millions of transactions a month to identify possible financial criminal activity.

Why was HSBC fined?

The FCA handed out the hefty  £63.9 million punishment after finding “serious weakness” with the bank’s systems.

It highlighted three key failings which were found over an eight year period from March 2010 to March 2018.

This included failures to consider whether the scenarios it used until 2014 to identify money laundering and terrorist financing covered relevant risks, as well as “poor” risk assessment of new scenarios after 2016.

The FCA also reported failures to “appropriately test and update the parameters” of the bank’s systems.

It was also found to be inadequately checking the accuracy and completeness of the data being fed into its monitoring systems.

What did the FCA say?

HSBC did not dispute the findings and agreed to settle at the earliest opportunity, resulting in a reduction in the fine from £91 million.

Mark Steward, executive director of enforcement and market oversight at the FCA, said: “HSBC’s transaction monitoring systems were not effective for a prolonged period despite the issue being highlighted on numerous occasions.

“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.”

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