The Hong Kong Monetary Authority (HKMA) has imposed a HK$875,000 fine on WeChat Pay Hong Kong for failing to meet anti-money laundering and counter-financing of terrorism (AML/CFT) standards.

The HKMA’s investigation, which began after a self-report from WeChat Pay, found that the company did not have adequate systems in place between August 2016 and October 2021.

These shortcomings affected its ability to conduct customer due diligence reviews when needed and to apply enhanced measures in high-risk situations involving money laundering and terrorist financing.

The shortcomings were specifically related to the requirements set out in the Payment Systems and Stored Value Facilities Ordinance (PSSVFO).

In deciding on the penalty, the HKMA considered the seriousness of the findings, the need to send a strong message to the industry, WeChat Pay’s remedial measures, and its cooperation with the investigation.

While the company has no previous disciplinary record and has been cooperative in resolving the issues, the fine underscores the critical importance of maintaining effective AML/CFT controls.

Raymond Chan, Executive Director (Enforcement and AML) of the HKMA, said,

“SVF [Stored Value Facility] licensees should apply enhanced due diligence measures on their customers in situations involving potentially high risk of money laundering and terrorist financing.

These enhanced due diligence measures should be effective in ensuring that the associated money laundering and terrorist financing risks are properly managed.”

WeChat Pay Hong Kong is owned by Tencent Holdings, the company behind the popular messaging app WeChat, known as Weixin in mainland China.