Taichung Bank Fined Record NT$32 Million for Internal Control Failures Aiding Fraud Ring
Taiwan's Financial Supervisory Commission (FSC) has fined Taichung Bank a record NT$32 million, the highest ever imposed on a banking institution, due to severe internal control deficiencies that facilitated money laundering exceeding NT$3.6 billion by a fraud syndicate. The bank is required to conduct a comprehensive review and implement corrective measures.
📋 Article Processing Timeline
- 📰 Published: May 12, 2026 at 17:44
- 🔍 Collected: May 12, 2026 at 18:02 (18 min after Published)
- 🤖 AI Analyzed: May 13, 2026 at 08:19 (14h 17m after Collected)
An investigation by the Taichung District Prosecutors Office revealed that Hong Yue-peng, the head of Wanli Development Company, colluded with six Taichung Bank employees, including managers and assistant managers, to open corporate accounts for gambling and fraud groups, facilitating the laundering of more than NT$3.6 billion.
The FSC stated that Taichung Bank failed to adequately establish and implement internal control systems concerning deposit account opening, customer due diligence, and account monitoring mechanisms. Consequently, the bank has been ordered to conduct a thorough review and develop improvement plans.
Tong Cheng-chang, Director-General of the FSC's Banking Bureau, explained at a press conference today that the investigation found deficiencies across 10 Taichung Bank branches, including Tanzhi, Zhongzheng, Beitun, Toufen, Yuanlin, Dounan, West Taichung, Taipei, Zuoying, and Wufeng. From April 2024, these branches handled the opening of deposit accounts for 21 corporate clients. The bank lacked proper review mechanisms for customer identification and online banking limits. Furthermore, there were multiple shortcomings in subsequent customer due diligence, monitoring and verification of abnormal transactions, and reporting of suspected money laundering activities, indicating a failure to adequately establish and enforce internal control systems.
Tong Cheng-chang noted that because the bank's actions violated multiple administrative obligations, the penalty was determined based on the highest applicable fine amount, resulting in the NT$32 million penalty. (Editor: Pan Yi-ching) 1150512
FAQ
What is the reason for the fine against Taichung Bank?
Taichung Bank was fined for severe internal control deficiencies that allowed a fraud syndicate to launder over NT$3.6 billion. Specifically, the bank failed to properly establish and implement systems for account opening, customer due diligence, and transaction monitoring.
How much was Taichung Bank fined?
Taichung Bank was fined NT$32 million, which is a record high for penalties imposed on a banking institution in Taiwan.
Who was involved in the money laundering scheme?
The scheme involved Hong Yue-peng, head of Wanli Development Company, who colluded with six Taichung Bank employees (managers and assistant managers) to open corporate accounts for gambling and fraud groups.
Which branches of Taichung Bank were implicated?
Ten branches were implicated: Tanzhi, Zhongzheng, Beitun, Toufen, Yuanlin, Dounan, West Taichung, Taipei, Zuoying, and Wufeng.
What are the next steps for Taichung Bank?
The bank has been ordered by the FSC to conduct a comprehensive review of its internal controls and develop improvement measures.