Regulators Hammer Absa With Multimillion-rand Penalty

Absa has been slapped with heavy penalties after the South African Reserve Bank's Prudential Authority uncovered serious failures to comply with anti-money laundering regulations.

In a media statement dropped late on Friday, the PA revealed that South Africa's third-largest lender by assets had been sanctioned for breaching critical parts of the Financial Intelligence Centre FIC Act following a 2022 inspection.

According to the regulator, Absa's shortcomings included major lapses in customer due diligence - specifically regarding high-risk clients such as foreign politically exposed persons and influential figures linked to state enterprises.

The probe found that Absa had failed to properly vet four foreign prominent public official FPPO client files and two politically exposed persons PEP tied to state-owned firms, along with inadequate enhanced due diligence on three domestic prominent influential persons DPIPs and five more FPPOs.

For these failures, the bank received an official caution, a reprimand, and a R7 million fine, as per Daily Investor.