SA Reserve Bank sanctions five banks over weak money-laundering controls
The five banks are co-operating and have agreed to address the deficiencies
The SA Reserve Bank has imposed administrative sanctions on five banks for weaknesses in their money-laundering control measures and ordered them to take remedial action, it said in a statement on Friday.
The five are Standard Bank, GroBank (formerly the SA Bank of Athens), the Bank of China’s Johannesburg branch, Ubank and HBZ Bank.
The banks, apart from HBZ, received fines totaling R37.5m, however, some of the amounts were suspended.
The Bank found weaknesses in each of the banks’ money-laundering controls after routine inspections conducted during 2018 in terms of the Financial Intelligence Centre Act (Fica).
The Bank said the sanctions were imposed because of weaknesses in the banks’ compliance with the provisions of the act, and “not because the said banks were found to have facilitated transactions involving money laundering or the financing of terrorism”.
Standard Bank was fined R30m for failure to comply with suspicious and unusual transaction reporting requirements, but R7.5m of the penalty was suspended for a period of three years, subject to Standard Bank adhering to certain conditions imposed by the central bank.
GroBank was fined R5m for failing to comply with cash-threshold reporting requirements. Under the act, banks must report cash transactions of more than R25,000. It was also fined for failing to meet requirements for reporting suspicious and unusual transactions and failing to meet training requirements.
The Bank of China was fined R2m for failing to meet cash-threshold reporting requirements. The full amounts of both these banks’ fines were, however, suspended subject to them meeting conditions imposed by the Bank.
Ubank was fined R500,000 for failing to comply with cash-threshold reporting requirements and given a directive to take remedial action.
HBZ was cautioned not to repeat the conduct that led to its failure to comply with suspicious and unusual transaction reporting requirements.
The Reserve Bank said, “The five banks are co-operating with the Reserve Bank and have agreed to the necessary measures to address the identified compliance deficiencies and control weaknesses.”