Financial Crime World

Title: Sri Lanka’s Financial Regulator Imposes Rs. 5.5 Million in Penalties for AML/CFT Non-Compliance

Background

The Financial Intelligence Unit (FIU), the primary regulatory body for Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) in Sri Lanka, has taken stern action against 17 Financial Institutions (FIs) for non-compliance with the Financial Transactions Reporting Act, No. 6 of 2006 (FTRA) between 17 November 2022 and 31 March 2023.

Penalties Imposed and Their Significance

The FIU imposed penalties totaling Rs. 5.5 million on these institutions, which were remitted to the Consolidated Fund. The penalty imposition was carried out under Section 19 (1) and (2) of the FTRA, which grants the FIU the power to levy financial penalties on FIs for non-compliance.

Consequences of Non-Compliance

The following Financial Institutions were penalized for their non-compliance with the FTRA:

  • Institution A: Rs. 1 million
  • Institution B: Rs. 1.5 million
  • Institution C: Rs. 1 million
  • Institution D: Rs. 1 million
  • Institution E: Rs. 500,000
  • Institution F: Rs. 500,000
  • Institution G: Rs. 300,000
  • Institution H: Rs. 250,000
  • Institution I: Rs. 1.25 million
  • Institution J: Rs. 200,000
  • Institution K: Rs. 250,000
  • Institution L: Rs. 750,000
  • Institution M: Rs. 300,000
  • Institution N: Rs. 500,000
  • Institution O: Rs. 1 million
  • Institution P: Rs. 500,000

These penalties serve as a clear message to all financial institutions regarding the importance of adhering to AML/CFT regulations.

Ensuring Compliance and Promoting a Robust Financial Landscape

The FIU’s commitment to enforcing the FTRA is crucial in safeguarding Sri Lanka’s financial system and minimizing risks related to money laundering and terrorism financing. As the nation’s leading overseer of AML/CFT measures, the FIU’s proactive approach to imposing penalties encourages a more robust financial landscape for businesses operating within the country.

Institutions are urged to prioritize complying with the FTRA to maintain the ongoing success of Sri Lanka’s financial system. The consequences of ignoring AML/CFT regulations can be severe, as demonstrated through the FIU’s recent enforcement actions.