PwC's Managing upstream risk: Regulatory reform review - An asian perspective August 2013 | Page 14

On 5 August 2013, FINRA fined Oppenheimer Holdings Inc. a sum of $1.4 million for an inadequate AML program and failing to detect and report suspicious penny stock transactions. The company has since announced that it has significantly tightened its policies relating to the sales of low-priced shares and enhanced its review of clients’ sales with respect to AML oversight. HSBC is closing the accounts of foreign diplomats in Britain and giving them 60 days to move their money. The London-headquartered bank said this decision was made as part of an assessment of business customers under which they must meet five criteria: • International connectivity; • Economic development; • Profitabilty; • Cost efficiency; and • Liquidity.

The global banking giant was fined US$1.9billion in 2012 over allegations of money laundering where the bank admitted to having inadequate controls in place. On 8 August 2013, Guaranty Trust Bank (UK) Ltd was similarly fined £525000 for failing to take reasonable care to establish and maintain effective AML systems and controls, breaching principle 3 of the FCA Principles. An investigation revealed that the bank failed to assess potential money laundering risks posed by high risk customers, screen prospective customers against PEPs database, review higher risk customers’ activities and ensure the higher risk customers’ information was up to date, among others.

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Regulatory Reform Review | Banking