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Time of India
23-07-2025
- Business
- Time of India
Indian Overseas Bank's Hong Kong branch fined ₹9cr
Indian Overseas Bank (Image only for representation) CHENNAI: The Hong Kong Monetary Authority has imposed a penalty of HK$8.5 million (Rs 9.3 crore) on Indian Overseas Bank, Hong Kong branch (IOBHK) for contraventions of anti-money laundering and counter-terrorist financing ordinance (AMLO). It has pulled up the lender for "significant failure" to mitigate risks. Apart from IOB, the authority has levied penalties against the Bank of Communications (Hong Kong) and Bank of Communications Co. Hong Kong branch for HK$ 4 million and HK$ 3.7 million, respectively. A senior IOB official told TOI that there was no fraud or any anti-money laundering and counter-financing of terrorism violations. It pertains to issues over handling alerts generated by the software, which the bank is addressing by putting additional checks in place. "IOBHK has no history of disciplinary record regarding AMLO. It was only a matter of putting procedures in place," the official said. The development follows an investigation by the HKMA, in which the authority has charged that IOBHK has contravened three specified provisions of AMLO between May 2021 and Jan 2024. "IOBHK's management oversight of anti-money laundering and counter-financing of terrorism (AML/CFT) controls was inadequate. The senior management did not have a clear leadership role and responsibility over AML/CFT matters. They did not adequately discuss key AML/CFT control issues at relevant committee meetings and failed to appoint a competent person with sufficient AML/CFT knowledge as the Compliance Officer. As a result, the transaction alerts generated by IOBHK's transaction monitoring system were not properly followed up," the HKMA statement said. IOB in a statement to the exchange said "The bank and its branch operating at Hong Kong have taken necessary preventive actions to avoid such recurrence in future and further strengthen its internal processes in this regard. The impact of the said action on the bank is not material." Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
22-07-2025
- Business
- Time of India
IOB's Hong Kong branch penalised Rs 9.3 crore under laundering law
CHENNAI: The Hong Kong Monetary Authority has imposed a penalty of HK $8.5 million (9.3 crore) on Indian Overseas Bank, Hong Kong Branch (IOBHK) for contraventions of Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO) and pulled up the lender for 'significant failure' to mitigate risks. Apart from IOB, the authority has levied penalties of HK$4 million and HK$3.7 million on Bank of Communications (Hong Kong) and Bank of Communications Co. Hong Kong Branch. A senior IOB executive, however, told TOI that there was no fraud or anti-money laundering and counter-terrorism financing violations. It pertains only to issues over handling alerts generated by the software, which the bank is addressing by having additional checks. 'IOBHK has no history of disciplinary record regarding AMLO. It was only a matter of putting procedures in place,' the official said. The development follows an investigation by HKMA, in which the authority has charged that IOBHK has contravened three provisions of AMLO between May 2021 and Jan 2024 (relevant period). The HKMA statement said there was a significant failure by IOBHK to take all reasonable measures to ensure that proper safeguards exist to prevent its contraventions of Sections 5(1) and 19(3) of Schedule 2 to AMLO and to mitigate money laundering and terrorist financing risks effectively during the relevant period. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like No annual fees for life UnionBank Credit Card Apply Now Undo The sections pertain to failure to establish and maintain effective procedures for the purpose of carrying out its duties, examine the background and purposes of transactions which were complex, unusually large in amount or of an unusual pattern, and had no apparent economic or lawful purpose. 'Specifically, IOBHK's management oversight of anti-money laundering and counter-financing of terrorism (AML/CFT) controls was inadequate. The senior management did not have a clear leadership role and responsibility over AML/CFT matters. They did not adequately discuss key AML/CFT control issues at relevant committee meetings and failed to appoint a competent person with sufficient AML/CFT knowledge as the compliance officer. As a result, the transaction alerts generated by IOBHK's transaction monitoring system were not properly followed up,' the statement added. HKMA has asked IOBHK to conduct a look-back review on the transaction alerts generated by its transaction monitoring system and after the review is completed, to report to HKMA. Seeking to submit a remedial plan to address the contraventions, the authority said, it has also taken into account all relevant circumstances of the case, including the need to send a clear deterrent message to IOBHK and the industry about the importance of having effective controls and procedures to address money laundering and terrorist financing risks. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
