Banking giant Standard Bank has been slapped with a R13 million penalty by the South African Reserve Bank (SARB) for failing to comply with specific provisions of the Financial Intelligence Centre Act (FICA).
While Mauritian government has not raised any red flags for Standard Bank Mauritius, but that doesn’t necessarily mean that SBM has enforced compliance and rules, it could reflect poorly on compliance measures among Mauritian financial institutions.
The SARB announced these administrative sanctions against the major retail bank in a statement released on its website late Friday afternoon.
The Prudential Authority, responsible for supervising and enforcing compliance among South Africa’s financial institutions, identified several instances of non-compliance by Standard Bank:
- The bank failed to conduct ongoing due diligence for two of its clients, with no due diligence reviews performed in 2018 and 2019.
- It did not maintain records of the submission dates for 43 suspicious and unusual transaction reports, as well as unusual activity reports sent to the Financial Intelligence Centre (FIC).
- Standard Bank failed to report 1,466 cash transaction reports and/or cash aggregation reports to the FIC in a timely manner, and did not report 17,259 suspicious transactions and unusual activity incidents.
- Additionally, the bank did not promptly address 75,729 alerts generated by its automated transaction monitoring system within the required 48 hours, and it exceeded the 15-day reporting window for 94,558 suspicious transactions and unusual activities.
Despite these shortcomings, the Prudential Authority noted that Standard Bank cooperated fully and has committed to implementing necessary remedial actions to rectify its compliance deficiencies and control weaknesses.
This sanction against Standard Bank marks the latest in a series of penalties imposed on South Africa’s financial institutions. In December, the SARB fined Capitec Bank R56 million for similar compliance issues.
Moreover, the Prudential Authority has also issued substantial fines to other institutions, including Old Mutual, Bidvest Bank, and HSBC, for non-compliance with FICA.
On January 16, the authority also applied to the High Court for the provisional liquidation of Ithala, a development finance institution based in KZN that operated as a bank until its licence was revoked last August.