Why was AEON Credit fined RM520,000 by Bank Negara Malaysia?

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AEON Credit Fined RM520,000 for Non-Compliance with Targeted Financial Sanctions Requirements

AEON Credit Service (M) Bhd was fined RM520,000 by Bank Negara Malaysia (BNM) due to failures in adhering to requirements concerning targeted financial sanctions (TFS). These breaches occurred when AEON Credit onboarded a customer identified on the Domestic List and subsequently delayed in freezing their account. The central bank's findings indicated that these lapses stemmed from insufficient staff oversight and deficiencies within AEON Credit's standard operating procedures (SOP).
Onboarding of a Sanctioned Entity

An examination by BNM revealed that AEON Credit accepted a specified entity, listed on the Domestic List, as a customer. The Domestic List comprises entities designated by the Home Affairs Minister under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA). This onboarding process occurred despite the entity being a positive match against the list.
Delayed Account Freezing

Beyond the initial onboarding, AEON Credit also failed to promptly freeze the account of the confirmed sanctioned customer. This delay in action, following the confirmation that the customer was a designated entity, constituted a separate breach of regulatory requirements.
Contributing Factors and Remedial Actions

BNM attributed these compliance failures to a lack of adequate staff oversight and gaps in AEON Credit's established SOP. In response to these findings, AEON Credit has since undertaken measures to rectify the situation. These actions include enhancing its SOP and conducting refresher training for its staff to ensure a stronger adherence to TFS regulations moving forward.
BNM's Consideration of Factors

In determining the administrative monetary penalty, BNM took into account various aggravating and mitigating factors. These considerations included the seriousness of the breaches, AEON Credit's degree of diligence in ensuring compliance with TFS requirements, its past compliance history, and its conduct after the misconduct, particularly the effectiveness of its remedial actions aimed at preventing future occurrences.

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Why was AEON Credit fined RM520,000 by Bank Negara Malaysia?

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