Hong Kong’s regulator has fined insurance giant AIA’s local branch over anti-money laundering lapses.
AIA was fined HK$23 million ($3 million) following an on-site inspection of its Hong Kong branch by the Insurance Authority (IA) which found multiple anti-money laundering (AML) lapses, according to a statement.
For both new and existing business from March 2016 to October 2022, IA found technical issues with the usage of AIA’s AML system and the associated algorithm. The probe found that not all customers considered politically exposed persons (PEP) were flagged by the screening process. Certain customers assessed as «high risk» were also not subjected to enhanced due diligence in a timely manner.
Company Response
In response, AIA has implemented a range of measures to address the issues, including «further investments to enhance and upgrade its AML system and associated processes». The insurer is also required to submit a report prepared by an independent external advisor to validate the ongoing effectiveness of the remediation measures.
«All authorized insurers and licensed insurance intermediaries carrying on long term business must have in place effective anti-money laundering and counter-terrorist financing controls and procedures,» IA said. «This disciplinary action demonstrates that they will be held to account for this, no matter the size of their operation.»
