HUNGARY’S BIGGEST BANKS Fined For AML Compliance Failures at Partner Currency Exchanges

Introduction

The Hungarian National Bank (MNB) has imposed significant fines on two major banks in the country, Takarékbank and Raiffeisen Bank, for failing to comply with anti-money laundering (AML) rules at their partner currency exchanges.

Fines Imposed by MNB

The MNB fined Takarékbank and Raiffeisen Bank a total of HUF108.6 million (approximately £250,000) for their AML compliance failures. The fine was imposed after the central bank found that five currency exchanges partnering with these banks repeatedly failed to report transactions suspected of money laundering or did so with delays.

Fines Breakdown

• Takarékbank: HUF12.5 million (approximately £29,300)
• Raiffeisen Bank: HUF16.25 million (approximately £38,600)

Review Findings

The MNB thematic review exposed widespread shortcomings in the banks’ supervision of key agents, including:

Key Shortcomings

• Failure to obtain information from high-risk customers about the source of their funds.
• Inadequate documentation of decisions made during the screening process.

Banking Laws and Regulations

Hungary’s banking laws require banks to regularly monitor their key currency exchange agents to ensure they fully comply with AML obligations. However, Takarékbank and Raiffeisen Bank failed to carry out proper checks, thus missing the deficiencies.

Importance of External Audits

The MNB stressed that it is crucial for banks to properly conduct external audits as certain small currency exchanges are exempt from internal audit processes.

Conclusion

The move by the MNB sends a strong message that it will not tolerate AML compliance failures in Hungary’s banking sector. As the country continues to navigate its economic challenges, strict enforcement of anti-money laundering regulations is more crucial than ever.