BMA fines Allianz Life Bermuda $1.7m

The Bermuda Monetary Authority (BMA) has fined Allianz Life Bermuda $1.7m for breaches of anti-money laundering and anti-terrorist financing regulations, as well as persistent breaches of the Insurance Act.

Allianz Life Bermuda, which was incorporated in 1976 and licensed since 1981, has consented to the fines and is planning to cancel its registration with the regulator and commence liquidation proceedings.

The BMA observed breaches and deficiencies of the anti-money laundering and anti-terrorist financing regulations at the life (re)insurer following an onsite review.

While there no evidence of money laundering or terrorist financing, the insurer failed to remediate the findings to the satisfaction of the regulator within a prescribed time period.

The breaches were considered serious because of the extent and duration and because they demonstrated a weakness of company controls to ensure full compliance with the regulations. As such, it was fined $1.25m.

Its breaches of the Insurance Act “demonstrated a pattern of non-compliance” by the company, failing to have a resident director in Bermuda at all times, no regular Bermuda decision-making meetings, nor management to ensure its annual filings were accurate, adequate and timely. It therefore failed to demonstrate that it maintained a head office in Bermuda, as required by the Insurance Act.

The BMA said the Insurance Act breaches highlighted the failure of the company to conduct business in a prudent manner, and it also determined that the corporate administration was not being carried on with the professional skills appropriate to the nature, scale and complexity of its activities.

This resulted in a further fine of $450,000.