Skip to content

News

TSB agrees to $3.85m penalty for money-laundering failures

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn

TSB has agreed to pay $3.85 million in penalties after acknowledging it failed to comply with rules designed to prevent the bank being used for money-laundering.

TSB and the Reserve Bank, which polices anti-money laundering (AML) rules, presented the settlement for approval by the High Court in Wellington on Thursday, after the Reserve Bank filed legal action in May.

Appearing for the Reserve Bank, Richard May, a partner at Luke Cunningham & Clere, set out details of four breaches of the Anti-Money Laundering and Countering Financing of Terrorism Act to Justice Jillian Mallon.

The action comes five years after TSB was formally warned for risk assessment and compliance failures.

May told the court “it was not suggested there has been actual financing of terrorism or money-laundering occurring”.

But he said the breaches were serious, because they concerned “the adequacy and effectiveness of the very processes by which an entity such as TSB is required to comply with the act and ensure it is complying”.

“To put it another way, if these controls aren’t in place or aren’t operating effectively, then it could not have known if financing of terrorism or money-laundering was occurring.”

TSB lacked adequate procedures, processes and controls, failed to review its AML programme, and did not conduct a risk assessment of its real estate business as it was supposed to do, he said.

Source: RiskScreen

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn

Related Posts

A guide to navigating skilled person reviews

A guide to navigating skilled person reviews

The Financial Conduct Authority (FCA) employs skilled person reviews, also known as Section 166 reviews, to assess and rectify concerns within financial institutions. Recent data reveals a significant uptick in
Read More >
financial crime compliance

The escalating costs of global financial crime compliance

The digital revolution, spearheaded by digital banking, cryptocurrency, artificial intelligence (AI), and digital payment systems, has significantly contributed to the exponential rise in global financial crime compliance costs. According to
Read More >