Allianz Life Bermuda has been fined $1.7m for significant breaches of anti-money laundering and anti-terrorist financing regulations, and is to go into liquidation.
The Bermuda Monetary Authority (BMA) said it has imposed civil penalties totalling $1,700,000 on Allianz Life Bermuda “pursuant to sections 20 and 24A of the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing Supervision and Enforcement) Act 2008 and section 32A of the Insurance Act 1978 with respect to significant breaches of the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing) Regulations 2008, International Sanctions Regulations 2013 and longstanding and persistent breaches of the Insurance Act.”
The BMA said the company has accepted its findings and has consented to and paid the civil penalties, and has further agreed to continue with its plan to cancel its registration under the Insurance Act and commence liquidation proceedings.
Allianz Life Bermuda was incorporated in Bermuda in 1976 and licensed as an insurer since 1981, and holds a Class 3 licence and Long-Term Class C licence. It was engaged in the insurance and reinsurance of life and long-term risks, which were written outside of Bermuda.
The BMA said: “The civil penalties have been imposed for the company’s failure to adequately comply with the following requirements of the regulations and the sanctions: i) regulation 16 – systems; ii) regulations 5 and 6 – customer due diligence; iii) regulation 8 – timing of verification; iv) regulation 7 – ongoing monitoring; v) regulation 11 – enhanced due diligence; vi) regulation 14a – outsourcing; vii) regulation 17a – independent audit functions; and viii) sanctions – reporting requirements.”
It added that while it found no evidence of money laundering or terrorist financing, the BMA required the company to remediate the findings within a prescribed time period, but this was not completed to the satisfaction of the Authority.
“The Authority views these breaches as serious because of their extent and duration, and because they demonstrated a weakness of the company’s controls to ensure full compliance with the regulations and sanctions,” said the BMA.
“The company has demonstrated a pattern of non-compliance with the Insurance Act, which contributed, in part, to the company’s failure to have a resident director in Bermuda at all times, no regular Bermuda decision-making meetings nor management to ensure that the company’s annual filings under the Insurance Act were accurate, adequate and timely,” said the BMA.
“Further, the Authority determined that the company’s corporate administration was not being carried on with the professional skills appropriate to the nature, scale and complexity of its activities.”