Customs Disciplines Non-Compliant MSOs
On April 30, 2024, Hong Kong Customs issued formal disciplinary action against money service operators for statutory AMLO contraventions.
On April 30, 2024, the Hong Kong Customs and Excise Department (C&ED) formally issued a Statement of Disciplinary Action under Part 5B of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615). As the statutory authority responsible for licensing and supervising Money Service Operators (MSOs), the C&ED exercises disciplinary powers to sanction licensees that fail to meet Hong Kong’s anti-money laundering and counter-terrorist financing requirements.
Under the AMLO framework, licensed remittance agents and money changers are subject to continuous supervisory oversight and unannounced on-site audits by Customs officers. The April 2024 disciplinary determination reinforces Customs’ strict enforcement stance on fundamental operational standards, which include conducting mandatory Customer Due Diligence (CDD) before processing currency conversions or cross-border remittances, verifying the identities of individuals executing transactions on behalf of customers, and maintaining complete, audit-ready transaction records.
Furthermore, the C&ED actively monitors corporate governance within MSOs, holding licensees accountable for failing to report material operational changes, register storage facilities, or ensure that senior management satisfies “Fit and Proper” competence standards. Under statutory guidelines, the maximum pecuniary penalty for serious contraventions can reach up to HK$10 million or three times the profit gained or costs avoided. For compliance professionals and MSO operators, this April 2024 action serves as a direct reminder that front-line operations must maintain complete compliance at the cashier counter to avoid public reprimands and severe statutory penalties.