Banking News

$36 billion in AML, KYC and sanctions fines

$36 billion in AML, KYC and sanctions fines

(29 January 2020 – Global) Financial services firms have been hit with a total of $36 billion in fines since the financial crisis for non-compliance with anti-money laundering, know your customer and sanctions regulations around the world.

The data, put together by regtech Fenergo, shows that penalties for AML, KYC and sanctions violations increased by 160 percent in the 15 months since the last tally.

Of the world's top 50 banks, 12 were hit with fines in 2019. By country, Switzerland was the biggest offender after a tier one player received the biggest single fine at $5.1 billion for AML breaches by the French Criminal Court.

Meanwhile, two thirds of all fines issued by US regulators were aimed at European financial institutions for AML breaches and sanctions violations with countries such as Iran, Cuba, North Korea, Sudan, Libya and Myanmar.

2019 was also the first year that punitive fines were handed out to tier one financial institutions for historical MiFID transaction reporting breaches. Two major fines amounting to $81.5 million were issued by the UK’s Financial Conduct Authority for transaction reporting failures.

Only 12 fines amounting to about $1.1 million were issued to financial institutions for non-compliance of data privacy regulations including GDPR and Personal Data (Privacy) Ordinance in Hong Kong.

A separate report from Encompass Corporation earlier this month found that in 2019 global penalties for anti-money laundering failures hit $6.2 billion at an average of $145.33 million per fine.

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