Wednesday, December 21, 2022


The latest in a long line of regulatory civil penalties against HSBC, this one on HSBC BANK MALTA for €82,566, plus a Follow-Up Directive and a formal Reprimand, has gone without ANY comment from the bank, and I have been looking diligently for one since early December. Why hasn't the entire compliance department at the bank's Malta subsidiary been sacked? A two million Euro transaction with zero documentation or justification reinforces my opinion that the bank's compliance culture has utterly failed.

Whilst Malta's Financial Intelligence Analysis Unit (FIAU) is to be commended for levying the civil penalty, and publishing the notice online for all to see, perhaps more should be done. If I was in charge of the FIAU, I would block the bank from onboarding any new customers until it demonstrates that it has built, and implemented, an effective AML/CFT compliance programme. There can be no excuse for this sloppy operation; obviously, the bank's executives have chosen to ignore the Rule of Law. Otherwise, how could it allow its staff to ignore obvious rampant money laundering activity.

If you are a compliance officer at a bank located in any Member state of the European Union, your prudent action is to now assess Malta as a high-risk jurisdiction for AML purposes, because if this is an indication of how business is done in Valletta, you want no part of any transaction that originates there.

Reader who wish to review the complete text of the FIAU Notice are advised to see our article on the subject, entitled   Read the Complete Text of Regulatory Fine Against HSBC Bank Malta .



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