Taipei Commercial Bank Fined 32 Million NTD for AML and Internal Control Deficiencies

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In the case of Taipei Commercial Bank's deficiencies in handling deposit account opening, ongoing customer identity verification, and account monitoring mechanisms, it is determined that the bank violated Article 45-1, Paragraph 1 of the Banking Act and its delegated "Implementation Measures for Internal Control and Audit Systems of Financial Holding Companies and Banks" Articles 4, Paragraph 1, 12, Paragraph 1, and Paragraph 3, as well as the "Financial Institutions Anti-Money Laundering Measures" Articles 3, 5, 6, 9, and 15, delegated under the Anti-Money Laundering Act. Pursuant to Article 129, Item 7 of the Banking Act, a fine of New Taiwan Dollars (hereinafter the same) 32,000,000 is imposed.

2026-05-15

Financial Supervisory Commission Penalty Decision

Addressee: As per original/copy Date of Issue: May 15, Year 115 of the Republic of China (2026) Document Number: Jin Guan Yin Guo Zi No. 11502713592

Respondent: Taipei Commercial Bank Unified Business Number: 51816908 Address: No. 87, Minquan Road, West District, Taichung City Legal Representative/Manager: Li [Redacted] Address: Same as above

Subject: In the case of Taipei Commercial Bank's deficiencies in handling deposit account opening, ongoing customer identity verification, and account monitoring mechanisms, it is determined that the bank violated Article 45-1, Paragraph 1 of the Banking Act and its delegated "Implementation Measures for Internal Control and Audit Systems of Financial Holding Companies and Banks" Articles 4, Paragraph 1, 12, Paragraph 1, and Paragraph 3, as well as the "Financial Institutions Anti-Money Laundering Measures" Articles 3, 5, 6, 9, and 15, delegated under the Anti-Money Laundering Act. Pursuant to Article 129, Item 7 of the Banking Act, a fine of New Taiwan Dollars (hereinafter the same) 32,000,000 is imposed.

Facts: Your bank's 10 branches, including Tansui, Zhongzheng, Beitun, Toufen, Yuanlin, Dounan, West Taichung, Taipei, Zuoying, and Wufeng, conducted deposit account opening operations for 21 corporate accounts starting from April of Year 113 (2024). These operations included customer due diligence and granting online banking limits. Your bank failed to establish proper review mechanisms, and there were multiple deficiencies in subsequent ongoing customer due diligence, continuous monitoring and verification of abnormal transactions, and reporting of suspected money laundering transactions. This indicates that your bank failed to properly establish and execute its internal control system.

Reasons and Legal Basis:

1. Article 45-1, Paragraph 1 of the Banking Act and its delegated "Implementation Measures for Internal Control and Audit Systems of Financial Holding Companies and Banks" Articles 4, Paragraph 1, 12, Paragraph 1, and Paragraph 3 stipulate that banks must establish internal control systems, including mechanisms for deposits, anti-money laundering, and counter-terrorist financing, and compliance management with relevant laws and regulations. Additionally, pursuant to Article 129, Item 7 of the Banking Act, if a bank fails to establish an internal control system in accordance with Article 45-1 or fails to execute it properly, it shall be fined between 2,000,000 and 50,000,000 NTD.

2. Pursuant to the "Financial Institutions Anti-Money Laundering Measures" Articles 3, 5, 6, 9, and 15, delegated under the Anti-Money Laundering Act, financial institutions must confirm customer identities, conduct ongoing customer identity verification, continuously monitor accounts or transactions, and report suspected money laundering or terrorist financing transactions. Additionally, pursuant to Article 8, Paragraph 5 and Article 13, Paragraph 5 of the Anti-Money Laundering Act, if a financial institution violates the aforementioned provisions of the "Financial Institutions Anti-Money Laundering Measures," the central competent authority shall impose a fine on the financial institution between 500,000 and 10,000,000 NTD.

3. Pursuant to Article 24, Paragraph 1 of the Administrative Penalty Act, if a single act violates multiple administrative legal obligations and is subject to fines, the penalty shall be imposed according to the provision with the highest statutory fine amount.

4. Upon review, your bank's handling of deposit account opening, ongoing customer identity verification, and account monitoring mechanisms had the following deficiencies:

(1) Failure to properly establish internal control systems

1. Failure to properly establish customer due diligence and ongoing customer identity verification procedures:

(1) In handling corporate account opening operations, your bank did not establish proper review mechanisms for matters such as first-time dealings, companies with low capital, those without local ties and without reasonable explanations, entities with multiple companies registered at the same address, and the customer's actual business model. Furthermore, branches could open accounts based on the bank's active recruitment without investigating the motives and purposes of customers applying for account openings at other financial institutions in a short period, failing to effectively prevent the opening of shell accounts. These deficiencies are inconsistent with Articles 3, Paragraph 4, Items 1 and 4, and Paragraph 5 of the "Financial Institutions Anti-Money Laundering Measures."

(2) In handling off-site corporate account opening operations, your bank did not require the retention of images of the account opener, nor did it require confirmation of business facts with the corporate representative and recording thereof. Consequently, when corporate accounts were opened, the business content and account opening needs were explained by individuals not registered as the representative of the enterprise in question. This is inconsistent with Articles 3, Paragraph 4, Items 1 and 4, and Paragraph 5 of the "Financial Institutions Anti-Money Laundering Measures."

(3) For branch customers whose transaction patterns significantly deviated from originally filled income or business nature data, or were obviously inconsistent with business facts, and were subsequently designated as warning accounts, or where your bank's branches reported suspected money laundering transactions to the head office, your bank did not establish abnormal indicators by analyzing the customer's background structure, transaction patterns, and fund flows for the accounts in question. Nor did your bank clarify the review standards and operational procedures for re-verifying the identity of such customers, leading other branches to continue accepting corporate account openings based on the aforementioned abnormal indicators.

2. Failure to properly establish online banking limit control mechanisms: For first-time dealings, newly established corporate customers with low capital, your bank did not require review of the customer's actual business model, did not require confirmation of the reasonableness of the high business volume filled in the account application form, and did not require verification of the reasonableness of the highest payment limit applied for online banking. Branch managers could grant the highest online banking payment limits without a proper differentiated limit granting mechanism, and your bank failed to establish an effective head office review and audit mechanism.

3. Failure to properly establish continuous transaction monitoring and abnormal transaction indicator monitoring mechanisms, resulting in unsound reporting of suspected money laundering transactions:

(1) For abnormal transaction indicators repeatedly generated by internal systems or accounts repeatedly reported by other banks through joint defense mechanisms, your bank did not conduct further visits to confirm whether the customer's identity background was commensurate with transaction amounts, nor did it verify the reasonableness of the source and destination of transaction funds. Instead, cases were closed as reasonable transactions or under continued observation. Your bank did not clarify standards for judging reasonable transactions and risk control measures, and lacked head office control and review mechanisms. These deficiencies are inconsistent with Articles 9, Paragraph 2, Items 2 and 3 of the "Financial Institutions Anti-Money Laundering Measures."

(2) For different legal entities conducting large-value withdrawal transactions through the same agent, after some corporate account transactions were reported as suspected money laundering due to abnormalities, your bank did not list large-value withdrawal transactions by the same agent at branches without local ties for other corporate accounts as abnormal indicators for detailed review. Your bank failed to implement control measures for large-value withdrawal transactions by the same agent and lacked bank-wide control and review mechanisms. This is inconsistent with Articles 9, Paragraph 4 and 5 of the "Financial Institutions Anti-Money Laundering Measures."

(2) Failure to properly execute internal control systems

1. Failure to properly execute re-verification of customer identity for abnormal transactions: Although your bank discovered that the deposit or transaction patterns of the customers in question were inconsistent with their business nature, it did not re-verify customer identities and review existing information for verification. It was only after the customers were designated as warning accounts that your bank raised their money laundering risk levels and executed due diligence operations. This is inconsistent with Article 5, Paragraph 4, Item 1 of the "Financial Institutions Anti-Money Laundering Measures."

2. Failure to properly execute review of transaction reasonableness: The transaction amounts of corporate accounts were significantly disproportionate to their capital, and after being designated as warning accounts, your bank, when conducting due diligence, did not, in accordance with Article 6, Paragraph 1, Item 1, Sub-item 2 of the "Financial Institutions Anti-Money Laundering Measures," request supporting documents for the source of funds from customers to confirm the authenticity of their business items.

3. Failure to properly execute online banking limit review operations: Although your bank implemented the new "Corporate Account Online Banking Total Limit and Electronic Certificate Verification Form" on February 21, Year 114 (2025), clarifying the implementation of corporate customer due diligence reviews (paid-in capital, business content, transaction purposes, etc.) and prudent evaluation of the reasonableness of total online banking limits and electronic certificate issuance, branches still failed to comply with the aforementioned regulations.

4. Failure to properly execute reporting of suspected money laundering transactions: Customers repeatedly met abnormal transaction indicators and had records of reports through the 165 Joint Defense Mechanism. However, branch investigations in previous instances were mostly closed as reasonable transactions or under continued observation. The reporting of suspected money laundering transactions was inconsistent with Article 15 of the "Financial Institutions Anti-Money Laundering Measures."

5. The aforementioned deficiencies indicate that your bank failed to properly establish and execute its internal control system. This constitutes a violation of Article 45-1, Paragraph 1 of the Banking Act and its delegated "Implementation Measures for Internal Control and Audit Systems of Financial Holding Companies and Banks" Articles 4, Paragraph 1, 12, Paragraph 1, and Paragraph 3, as well as the "Financial Institutions Anti-Money Laundering Measures" Articles 3, 5, 6, 9, and 15, delegated under the Anti-Money Laundering Act. Pursuant to Article 24, Paragraph 1 of the Administrative Penalty Act, if a single act violates multiple administrative legal obligations and is subject to fines, the penalty shall be imposed according to the provision with the highest statutory fine amount. Therefore, pursuant to Article 129, Item 7 of the Banking Act, a fine of 32,000,000 NTD is imposed.

Payment Method:

1. Payment Deadline: Payment must be made within 10 days from the day following the service of this decision.
2. Please follow the payment instructions attached by the Banking Bureau of this Commission.

Notes:

1. If the respondent disagrees with this decision, they must, within 30 days from the day following the service of this decision, prepare an appeal petition in accordance with Article 58, Paragraph 1 of the Administrative Appeal Act and submit it through this Commission (18th Floor, No. 7, Section 2, Xianmin Avenue, Banqiao District, New Taipei City) to the Executive Yuan for appeal. However, pursuant to Article 93, Paragraph 1 of the Administrative Appeal Act, unless otherwise provided by law, filing an appeal does not suspend the execution of this decision, and the respondent must still pay the fine.
2. If the respondent fails to pay the fine within the payment period specified in this decision, the case will be transferred to the various sub-bureaus of the Administrative Enforcement Agency of the Ministry of Justice for administrative enforcement, pursuant to the proviso of Article 4, Paragraph 1 of the Administrative Enforcement Act.

Original: Taipei Commercial Bank Co., Ltd. (Representative: Mr. Li [Redacted]) Copy: Central Bank, Central Deposit Insurance Corporation (Representative: Huang [Redacted]), Inspection Bureau of this Commission, Banking Bureau

Last Updated: 2026-05-18

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