Corlytics, a provider of regulatory risk intelligence, has released an enforcement data report for 2023 revealing financial crime, data protection, and governance as the main risk categories for financial services with the highest penalties. Some $6.7 billion of fines were imposed for financial crime, most of which were for money laundering and terrorist financing.
Looking at data protection, penalties for 2023 violations of General Data Protection Regulation (GDPR) surpassed the total for 2021, 2020, and 2019. The EU levied fines totalling almost €2.1 billion for non-compliance with GDPR.
The regulatory landscape for crypto and digital assets witnessed an unparalleled surge in enforcement actions. The world’s largest crypto exchange, Binance, faced a staggering $4 billion fine from the US Government’s Financial Crimes Enforcement Network (FinCEN) and Office of Foreign Assets Control (OFAC) for the violations of the Bank Secrecy Act. The fine was the biggest of the year.
Geographically, the Corlytics report notes the number of fines in the Americas was 14 times higher than in APAC and four times higher than in Europe. The UK Financial Conduct Authority (FCA) had a relatively quiet year on the fines front charging just £52.8 million ($66.7 million).
After a quiet first two quarters, global regulators fined over 80% of the total amount from July to December 2023. US regulators occupied the leading positions in all the fines categories. The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) were among the most active regulators, issuing enforcement fines of $3.4 billion and $1.4 billion respectively.
Corlytics’ quarterly and annual forensic analysis of regulatory data is provided by the company’s team of experts to help financial services firms track regulatory activity across the globe.
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