TNG Digital fined RM 600K by BNM for allowing sanctioned individuals to use TnG eWallet

An interesting notice went up on Bank Negara Malaysia’s official website today. It seems that TNG Digital was fined for non-compliance with the Financial Services Act 2013.

Specifically, the company contravened the act by also involving the following policies:

1. the Anti-Money Laundering and Counter Financing of Terrorism – Electronic Money and Non-Bank Affiliated Charge & Credit Card (Sector 4) policy document (AML/CFT Sector 4 PD)
2. the Anti-Money Laundering, Countering Financing of Terrorism and Targeted Financial Sanctions for Financial Institutions policy document (AML/CFT and TFS for FIs PD)

In the notice from Bank Negara, TNG Digital on two separate occasions allowed two individuals, who have been sanctioned by the government under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities (Declaration of Specified Entities and Reporting Requirements) (Amendments) Order 2014, to register for an eWallet account.

On the first occasion, TNG Digital failed to conduct sanction screening on customer names to ensure that they are allowed to use financial instruments licensed by the government.

The second occasion was when TNG Digital failed to cross-check if the customer’s name in their system was matched with the United Nations Security Council Resolutions List or the Minister of Home Affairs Domestic List.

In both cases, it seems that human error and minimal due diligence was made to ensure the customers are legally allowed to use the TnG eWallet.

TNG Digital however immediately reported to Bank Negara Malaysia once they realised the two infractions happened. Remedial steps were taken by the company to address the non-compliance actions.

Even so, BNM imposed an Administrative Monetary Penalty (aka fine) of RM 600,000 on TNG Digital, which the company paid on 31 May 2023.