HSBC Malaysia penalized $690,000 for customer screening non-compliance

Customers were reportedly onboarded without proper sanctions screening.

HSBC Malaysia and HSBC Amanah Malaysia were collectively fined about $693,000 (MYR 2.94m) by the central bank for non-compliances to the Islamic Financial Services Act 2013, as well as anti-money laundering and counter terrorism financing regulations (AML/CFT).

During a review in 2023, HSBC found that customers were onboarded without proper sanctions screening due to staff oversight, ineffective maker-checker functions, and inadequate system capabilities.

Remedial measures implemented by HSBC were reportedly insufficient, according to the Bank Negara Malaysia (BNM). This led to similar breaches recurring in 2024.
HSBC has since enhanced its system capabilities to prevent account openings until all sanctions screening processes have been completed.

The bank paid the total fine of $768,000 (MYR3.26m)— which included a separate $76,000 (MYR324,000) fine for non-compliance to AML and CFT rules— in March 2025.

(US$1 = MYR4.24; as of 30 May 2025, Google from Morningstar)

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