The Ministry of Finance (MOF) yesterday asked all state-run financial institutions to improve regulatory compliance at their overseas branches by hiring local experts, despite higher costs.
The ministry, the largest shareholder in state-run financial institutions and responsible for the appointments of their chairpersons, made the request after a meeting with the institutions’ top executives yesterday afternoon.
Deputy Minister of Finance Su Jain-rong (蘇建榮) said the ministry will mete out punishments after it received the results of a cross-ministerial probe into the failure of Mega International Commercial Bank’s (兆豐銀行) New York branch to comply with rules against money laundering.
The New York State Department of Financial Services on Friday announced in a statement that the New York branch of Mega bank agreed to pay a US$180 million fine for violating the US Bank Secrecy Act and money laundering regulations.
The branch failed to notify local regulators of more than 70 transactions in 2012 that involved Panama, a high-risk area for money laundering, the department said in the statement.
After hearing a report by Mega Financial Holding Co (兆豐金控) chairman Shiu Kuang-si (徐光曦), Su attributed the bank’s violation mainly to negligence that could have been avoided if it had a better understanding of New York’s compliance requirements.
Mega bank should have notified the ministry and the Financial Supervisory Commission of the issue as soon as the US authorities first demanded a solution in February, Su said.
“The incident shows the need for local compliance counsel. All state-run financial institutions should make use of local experts at overseas branches to avoid similar negligence,” Su said.
Such an arrangement would entail significant compliance costs.
Taishin International Bank (台新銀行), the main unit of Taishin Financial Holding Co (台新金控), last year called off plans to set up a branch in the US over concerns of high compliance costs, the conglomerate’s chief financial officer Welch Lin (林維俊) said yesterday.
Mega Financial president Wu Hann-ching (吳漢卿) has offered to step down over the mishap, but the most profitable state-run financial institution has asked Wu to remain in his post until the government probe is completed.
Mega bank rejected media reports that its New York branch was fined for money laundering.
Tropical Storm Gaemi strengthened into a typhoon at 2pm yesterday, and could make landfall in Yilan County tomorrow, the Central Weather Administration (CWA) said yesterday. The agency was scheduled to issue a sea warning at 11:30pm yesterday, and could issue a land warning later today. Gaemi was moving north-northwest at 4kph, carrying maximum sustained winds near its center of up to 118.8kph and gusts of 154.8kph. The circumference is forecast to reach eastern Taiwan tomorrow morning, with the center making landfall in Yilan County later that night before departing from the north coast, CWA weather forecaster Kuan Shin-ping (官欣平) said yesterday. Uncertainty remains and
SEA WARNING LIKELY: The storm, named Gaemi, could become a moderate typhoon on Wednesday or Thursday, with the Taipei City Government preparing for flooding A tropical depression east of the Philippines developed into a tropical storm named Gaemi at 2pm yesterday, and was moving toward eastern Taiwan, the Central Weather Administration (CWA) said. Gaemi could begin to affect Taiwan proper on Tuesday, lasting until Friday, and could develop into a moderate typhoon on Wednesday or Thursday, it said. A sea warning for Gaemi could be issued as early as Tuesday morning, it added. Gaemi, the third tropical storm in the Pacific Ocean this typhoon season, is projected to begin moving northwest today, and be closest to Taiwan on Wednesday or Thursday, the agency said. Today, there would likely
DISRUPTIONS: The high-speed rail is to operate as normal, while several airlines either canceled flights or announced early departures or late arrivals Schools and offices in 15 cities and counties are to be closed today due to Typhoon Gaemi, local governments announced last night. The 15 are: Taipei, New Taipei City, Taoyuan, Tainan, Keelung, Hsinchu and Kaohsiung, as well as Yilan, Hualien, Hsinchu, Miaoli, Chiayi, Pingtung, Penghu and Lienchiang counties. People should brace for torrential rainfall brought by the storm, with its center forecast to make landfall on the east coast between tonight and tomorrow morning, the Central Weather Administration (CWA) said. The agency issued a sea warning for the typhoon at 11:30pm on Monday, followed by a land warning at 11:30am yesterday. As of
CASUALTY: A 70-year-old woman was killed by a falling tree in Kaohsiung as the premier warned all government agencies to remain on high alert for the next 24 hours Schools and offices nationwide are to be closed for a second day today as Typhoon Gaemi crosses over the nation, bringing torrential rain and whipping winds. Gaemi was forecast to make landfall late last night. From Tuesday night, its outer band brought substantial rainfall and strong winds to the nation. As of 6:15pm last night, the typhoon’s center was 20km southeast of Hualien County, Central Weather Administration (CWA) data showed. It was moving at 19kph and had a radius of 250km. As of 3pm yesterday, one woman had died, while 58 people were injured, the Central Emergency Operation Center said. The 70-year-old