Fenergo's findings show penalties for AML/KYC non-compliance totalling USD 10.4 bln

The company’s discoveries show that for the year to date, penalties have totalled USD 10.4 billion for non-compliance with AML, KYC, data privacy, and MiFID (Markets in Financial Instruments Directive) regulations. The total volume of fines levied to financial institutions for these breaches was 198, a year-on-year increase of 141%. The average value of enforcement actions against financial institutions for AML related compliance breaches is 44% lower than in 2019. 

Other findings of the annual report include:

• Landmark action against Goldman Sachs totalling USD 6.8 billion for its involvement in 1MBD scandal; Major Australia-based bank fined almost USD 1bn for its money laundering scandal with links to serious crimes;

• In 2019, nine fines amounting to USD 2.4 billion were issued by US regulators to foreign banks (UK and Italy) for sanctions violations. In 2020, one fine was issued by the Office of Financial Sanctions Implementation (OFSI) to a UK bank for breaking Russian sanctions violations – USD 25.4 million;

• 203 individuals were fined USD 88.8 million for AML and MIFID breaches in US, Europe, and China;

• Global data privacy fines amounted to USD 88.6 million.

Countries that issued the most fines by value:

• USA – USD 4,348,701,664;

• Malaysia – USD 3,900,000,000; 

• Australia – USD 921,587,910;

• Sweden – USD 550,169,770;

• UK – USD 199,306,927.

There was also a significant rise in the number of data privacy fines in 2020, while the administrative sanctions handed out for MiFID violations are lower in volume and value compared to 2019. This year, a total of 36 fines were issued to financial institutions and individuals at the value of USD 7 million. On the data privacy side, the number of data privacy fines issued in the APAC region increased with USD 529,027 fine issued in India and seven fines issued in China totalling USD 6,338,969. The most significant fine levied for data privacy was to Capital One for USD 80,000,000 by US regulator, Office of the Comptroller of the Currency (OCC), for its 2019 cloud data breach.