Dubai's Financial Services Authority (DFSA) issued an AED 4,113,200 (€1.126M) fine to the Dubai branch of the Bank of Singapore for "inadequate" anti-money laundering systems and controls.
The DFSA stated in a statement that it had detected weaknesses in the bank's AML business risk assessments, customer risk assessments, customer due diligence (CDD) and enhanced CDD, identification of customer source of wealth and source of money, and reporting of suspicious activities.
The DFSA determined that the bank had acted "outside the scope" of its DFSA Licence by "arranging deals in investments in relation to rights under Long-Term Insurance contracts, when not authorised to do so".
Since then, the bank has applied to the DFSA for permission to do so, and has provided the DFSA with an Enforceable Undertaking (EU) in which it agrees to "remediate the deficiencies in its systems and controls, and engage an external compliance expert to assist the Bank in complying with its obligations and verify that the remediation has been completed."
Ian Johnston, CEO of the DFSA, stated, “The DFSA has a high degree of concern over any AML related contraventions and will take appropriate action to make sure that the systems and controls implemented by Authorised Firms operating in the DIFC are robust.”
The amount of the penalties was decreased as a result of the Bank's offer of an EU to correct its errors and resolve the problem. As a result, the original AED 7,345,000 (€2 million) fine was decreased.
By fLEXI tEAM