The crackdown on anti-money laundering has been on a constant rise as regulators slapped financial institutions across Africa with heavy fines for floundering the rules, especially in 2021.
This article covers some of the major fines and penalties imposed on financial institutions across Africa for breaking AML laws as well as key takeaways from the cases.
2021 Anti-Money Laundering Fines in Africa
From noncompliance with AML standards to improper risk assessments and handling of customer accounts, financial institutions across Africa were fined for various offences and the amounts disclosed at the end of the lenders’ audited results.
Here are some of the biggest anti-money laundering fines in Africa in 2021 and key takeaways from them.
1. Access Bank Nigeria
Fine: N57 million, N42 million, N1 million, N10 million.
Access bank Nigeria was slapped with N57 million in fines fine after failing to comply with the Central Bank of Nigeria’s anti-money laundering and terrorism financing code between 2018 and March 2019. The commercial giant was also levied N42.8 million for a similar offence, but more closely related to floundering CBN’s Know Your Customer policies in a transaction.
Access Bank was also fined the sum of N1 million as a result of operating a Tier 3 account without proper means of identification and N10 million for inadequate KYC.
Key Takeaway: KYC, AML and CFT policies should be performed diligently, adhering to the rules set by regulatory bodies in the region and globally.
2. Guarantee Trust Bank (GTB) Nigeria
Fine: N186 million
GTB was one of the Nigerian banks fined millions due to breaking CBN laws. The sum was N186 million for a failure to conduct spot-check examinations on certain domiciliary accounts of customers.
Key Takeaway: Financial institutions should thoroughly understand and adhere to laws set by the CBN.
3. Stanbic IBTC Nigeria
Fine: N20 million, N3 million and N2 million.
In the words of the auditors
“Penalties arising from the AML/CFT examination of the bank: The CBN imposed a penalty of N20m on the bank for failing to report some alleged suspicious transactions. The SEC imposed a total penalty sum of N3m against SIAML for maintaining its mutual funds’ collection bank accounts as non-custodian.
Additionally, the bank was also fined N2 million for not completely complying with the laid directives on linking, Bank Verification Number (BVN) details, directors, exchange signatures and beneficial owners of respective entity accounts at both incorporated and non-corporated levels.
Key Takeaway: AML laws must be adhered to at the grass root and top levels.
4. Deutsche Bank South Africa
Fine: 28 Million rand
The South African Reserve Bank (SARB) fined Deutsche Bank 28 million rand for failure to comply with anti-money laundering laws and countering the financing of terrorism. After a robust audit, weaknesses were identified in Deutsche Bank’s compliance structure and the provisions of the Financial Intelligence Centre (FIC) Act and not due to facilitating transactions that may involve money laundering.
Key Takeaway: Financial institutions should look to establish effective AML structures while focusing on identifying and preventing money laundering-related transactions.
5. Discovery Life
Fine: 1.5 Million rand
Regulatory bodies fined Discovery Life 1.5 Million rand for failing to comply with cash threshold reporting requirements according to the FIC Act.
Key Takeaway: it is important to comply with requirements set by authorities.
Achieving AML using Youverify
Top financial institutions operating within Africa received huge fines for breaking AML and CTF laws in 2021, stressing how much important it is for others to comply moving forward.
Regulators are looking to restrict the illegal flow of cash, therefore, increasing the pressure and scrutiny on financial institutions. This is why your compliance solution as a business needs to be able to keep up with the constantly evolving regulatory landscape and the nature of criminal activities.
Robust KYC, screening for PEPs and adequate customer risk assessment and classification should be part of your company AML policy. Real-time transaction monitoring and Know Your business solution is also very critical.
Youverify’s compliance software solution was designed to help you manage all of this in one place, satisfying compliance requirements while saving cost, and labour, and not having to slow down business operations.