HSBC fined nearly £300K by FSA

Follows two breaches in August and September 2023

The Island-based branch of HSBC has been fined nearly £300,000 after being found to have breached anti-money laundering and countering the financing of terrorism rules.

The breaches occurred via two unconnected matters in subsequent months - one of which was 'proactively self-reported to the authority by HSBC'.

In the first matter, HSBC discovered in August 2023 that earlier the same month it had paid away funds in the form of three recurring payments for a client that was subject to a restraint order issued by the Isle of Man Courts pursuant to the Proceeds of Crime Act 2008.

That order restrained the client from dealing with funds in specified bank accounts beyond permitted certain monthly payments.

HSBC notified the Financial Services Authority of this breach, according to its obligations under Anti-Money Laundering and Countering the Financing of Terrorism legislation, and the Financial Services Rule Book 2016.

In the second matter, on 4 September 2023, the authority became aware that HSBC had issued a cheque without the required consent from the Financial Intelligence Unit. 

Following a request from the authority, HSBC subsequently submitted the relevant notification.

As a result of the two breaches, the bank was fined £419,900, discounted by 30 percent to £293,930.

The FSA has said it is 'satisfied that HSBC cooperated fully and engaged positively' and that the responsible officers of HSBC at the relevant time have 'taken full responsibility for the issues identified by the authority'.

At the date of the settlement agreement, made between the authority and HSBC, the bank confirmed that the relevant operational controls have been enhanced to prevent any similar breach occurring in the future.

You can read more HERE.