Three insurance broker firms in Hong Kong have been fined a combined HK$429,000 by the Insurance Authority over failures to comply with anti–money laundering rules.
The enforcement action covers ASI-Union Global Assets Management Ltd., Macroscopica International Wealth Management Ltd., and Bay Union Insurance Brokers Limited, formerly known as Huize Hong Kong Insurance Broker Limited.
Three related individuals were also reprimanded for breaches of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance.
According to the regulator, the companies failed to establish and maintain effective procedures for conducting customer due diligence. The deficiencies included not properly determining whether clients were politically exposed persons and failing to identify situations where an individual was acting on behalf of a customer. The firms were also found to have shortcomings in keeping the required records related to these checks.
The IA said the broker companies have since taken remedial actions to address the compliance gaps identified during the investigation.
“Broker companies remain at the frontline of interaction with policy holders and play a vital role in safeguarding the reputation of Hong Kong as an international financial centre by preventing the insurance sector from being exploited for money laundering and other financial crimes,” the regulator said.
The action comes as Hong Kong’s insurance regulator has stepped up scrutiny of anti–money laundering controls across the industry in recent years, including large enforcement cases tied to compliance systems and due-diligence processes. In 2024, for example, the IA imposed a HK$23 million penalty on AIA International’s Hong Kong branch after an inspection found deficiencies in its anti-money laundering systems, including failures to flag some politically exposed persons and delays in enhanced due diligence for higher-risk customers.
IA has long emphasized that financial institutions - including insurers and brokers - must maintain proper customer due diligence and record-keeping procedures under the ordinance. This includes identifying beneficial owners, assessing customer risk levels, and monitoring suspicious transactions.
