FIU collects Rs.1.7mn in penalties from 4 financial institutions for AML/CFT non-compliance

Sri Lanka’s regulator for Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT), the Financial Intelligence Unit (FIU) has collected administrative penalties totalling Rs.1.7 million from four financial institutions during the period spanning from April 1, 2023, to September 26, 2023.
The administrative penalties were imposed for the failure to adhere to Financial Transactions Reporting Act, No. 6 of 2006 (FTRA), in relation to reporting of financial transactions.

A penalty of Rs.300, 000 was imposed on Merchant Bank of Sri Lanka & Finance PLC on July 12, 2023 due to its failure to comply with Section 6 of the FTRA. The bank had not reported pawning auction transactions exceeding Rs.1 billion as required by the regulation.
An administrative penalty of Rs.200, 000 was imposed on Vallibel Finance PLC on July 12, 2023, for its failure to adhere to Section 6 of the FTRA. Specifically, the company had not reported  transactions, as required by the Act, related to the granting of gold loan facilities exceeding Rs.1 million.

LB Finance incurred a penalty of Rs.700, 000 on August 9, 2023 due to its non-compliance with Section 6 of the FTRA. The violation pertains to the company’s failure to report pawning auction transactions that exceeded Rs.1 million conducted as bulk transactions (consisting of the sum of many individual transactions) or as single transactions.
A penalty of Rs.500, 000 was imposed on People’s Leasing & Finance PLC on August 18, 2023 for its non-compliance with Section 6 of the FTRA. Specifically, the company had failed to report electronic fund transfers related to the opening of a fixed deposit that exceeded Rs.1 million, as mandated by the regulation.