Reserve Bank fines Absa R10 million after money laundering probe

The South African Reserve Bank (SARB) has imposed fines on two local banks because of weaknesses it said it found in their control measures to combat money laundering.

The Reserve Bank said it imposed administrative sanctions on Société Générale Johannesburg Branch, and Absa Bank Limited (Absa), and has directed the firms to take remedial action.

The SARB said it conducted inspections in terms of the Financial Intelligence Centre Act (FIC Act) and found weaknesses in both bank’s anti-money laundering and combating the financing of terrorism control measures.

It imposed the following penalties:

Absa: A financial penalty of R10 million and a directive to take remedial action in the following area:

  • certain identified weaknesses in the bank’s controls and working methods pertaining to transaction monitoring.

Société Générale: A financial penalty of R2 million and a directive to take remedial action in the following areas:

  • identifying and verifying customers’ details (better known as know-your-customer or KYC requirements);
  • maintaining customer and transactional records as prescribed.

The central bank said that the financial penalty is, however suspended for a period of two years from 27 October 2016, subject to Société Générale adhering to certain conditions.

It stressed that neither bank was found to have facilitated transactions involving money laundering or the financing of terrorism.

The SARB said that both banks “are cooperating with the SARB and have taken measures to address the identified compliance deficiencies and control weaknesses”.

Read: Reserve Bank fines 5 SA banks after money laundering probe

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