HKIA fines AIA International $3.0m for AML lapses

The insurer said conclusions were technical in nature with no findings of money laundering activities or inappropriate onboarding.

The Hong Kong Insurance Authority (HKIA) has imposed a $3.0m (HK$23m) penalty on AIA International Limited's Hong Kong branch following an on-site inspection under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO). 

The inspection, which covered business processes from March 2016 to October 2022, identified deficiencies in the company’s anti-money laundering (AML) system.

The IA's inspection revealed that the company's AML system failed to flag certain customers who were politically exposed persons (PEPs) during the screening process. 

This led to delays in establishing the source of funds and obtaining required senior management approval. 

Additionally, some high-risk customers were not subjected to enhanced due diligence in a timely manner, and the monitoring processes for suspicious transactions were found lacking. 

The HKIA also noted that there was room for improvement in the company's overall AML compliance and management oversight.

In response, AIA International has taken steps to address these issues. 

The company has invested in upgrading its AML system and has implemented measures to strengthen governance, controls, and oversight. An independent external advisor will validate the ongoing effectiveness of these remediation measures as required by the HKIA.

AIA* also pledged its full support of the HKIA's initiatives. "We closely cooperated with the regular AML inspection of AIA’s Hong Kong branch, which began in 2021. The conclusions were technical in nature with no findings of money laundering activities or inappropriate onboarding of any customers. All identified issues have been fully remediated," it said.

($1.00 = HK$7.78)

*This article has been updated as of 5 August 16:26 to reflect AIA's statement.