BNM fines company, 2 banks over sanctions breaches

Bank Negara Malaysia, Malaysia's central bank, has imposed administrative monetary penalties on a fintech company and two banks for breaching targeted financial sanctions requirements. The penalties were imposed on April 15, May 6, and June 15, respectively.

Setel Ventures Sdn Bhd, the fintech company, was fined RM637,500 for failing to promptly update its sanctions database after the government published its Domestic List, a register of individuals and groups flagged for money laundering or terrorism financing. The bank stated that Setel failed to conduct sanctions screening on its customers and was unable to determine if matches were true matches due to gaps in its policies and systems.

However, Setel has since remedied these issues by updating its SOPs and improving its internal systems to ensure compliance with the targeted financial sanctions (TFS) requirements. Setel paid the RM637,500 penalty on May 6.

Standard Chartered Bank Malaysia and Standard Chartered Saadiq were each fined RM132,000 for not updating their sanctions databases immediately following the publication of the Domestic List. This oversight resulted in screening being conducted against outdated databases. Despite this, neither bank onboarded specified entities or facilitated transactions involving them.

The central bank noted that both banks have since taken steps to strengthen their controls and enhance the effectiveness of their sanctions screening management. Standard Chartered Bank and Standard Chartered Saadiq each paid the RM132,000 penalty on June 15. BNM emphasized that the enforcement actions were in line with its published Enforcement Approach.