Hong Kong regulator fines Coutts for breaches in anti-money laundering rules

HONG KONG, April 11 (Reuters) - The Hong Kong Monetary

Authority (HKMA) said on Tuesday it had ordered the local branch

of private bank Coutts & Co Ltd to pay a fine of HK$7 million

($900,808.15) for breaches in anti-money laundering and

counter-terrorist rules.

HKMA said its action followed a probe that found between

April 2012 and June 2015 Coutts failed to set up and maintain

procedures for determining if "its customers or the beneficial

owners of its customers were politically exposed persons".

The regulator's probe also found that Coutts's Hong Kong

branch had also failed to identify politically exposed persons

(PEP) despite relevant information being publicly available, it

said in its order.

The private bank also failed to follow up promptly on "PEP

alerts received from a commercially available database" to which

Coutts subscribed, the order said, adding the firm has taken

remedial measures to address the deficiencies identified.

Royal Bank of Scotland sold the majority of Coutts'

international assets to Union Bancaire Privee (UBP) in March

2015 after splitting the bank, best known as banker to Britain's

Queen Elizabeth, into a British and a Swiss-based arm.

A spokesperson for UBP could not immediately be reach for


($1 = 7.7708 Hong Kong dollars)

(Reporting by Sumeet Chatterjee and Michelle Price, editing by

Louise Heavens)