The highest fine in banking history! Taichung Bank executives colluded with a fraud group to launder money, and the Financial Supervisory Commission imposed a heavy penalty of 32 million.

Taichung Bank executives colluded with a fraud syndicate to launder money, with the amount of funds involved reaching NT$3.64 billion. Due to the failure of internal controls and the failure to implement anti-money laundering measures, the Financial Supervisory Commission (FSC) imposed a heavy fine of NT$32 million—setting a record for the highest fine in Taiwan’s banking industry—and required comprehensive improvements to its internal-control and prevention mechanisms.

Taichung Bank executives colluded with a fraud group to launder money; FSC fines NT$32 million

According to reports by the Central News Agency and Economic Daily News, the FSC announced yesterday (5/12) that, for deficiencies related to Taichung Bank’s handling of deposit account openings, ongoing customer identity verification, and account monitoring mechanisms, it imposed a statutory fine of NT$32 million, setting the highest penalty record in Taiwan’s banking industry history.

Tong Zhengzhang, Director of the FSC Banking Bureau, said investigations found that, for 21 corporate account openings handled since April 2024, 10 branches of Taichung Bank had failed to establish proper review mechanisms regarding customer identification procedures and online banking transaction limits.

There were also multiple serious deficiencies in the subsequent processes, including customer due diligence on identity, verification of suspicious transaction monitoring, and filing of suspicious money-laundering reports, indicating that the bank did not properly implement its internal control system. Because a single act violated multiple provisions on administrative legal obligations, the FSC imposed, in accordance with law, the maximum monetary penalty of NT$32 million.

Taichung Bank money-laundering case from start to finish: Executives abused their authority to shield the fraud group

Looking back at the full course of the money-laundering case, the Taichung District Prosecutors’ Office found that Hong Yuepeng, the person in charge of Wànlǐ Development Company, from September 2024 to April 2025, colluded with a total of 6 supervisors—managers and assistant managers—from four branches of Taichung Commercial Bank—to facilitate money laundering.

These supervisors helped the criminal syndicate open financial accounts under the names of 12 fictitious firms. Not only did they fail to retain images during account opening as required, they also deliberately raised the accounts’ huge transfer limits.

When “head” (straw-person) accounts triggered suspicious money-laundering alert notifications, the bank supervisors involved intentionally provided cover and delayed reporting. Even after reporting abnormal transactions, they still neglected to carry out prevention measures such as suspending or restricting remittances from the accounts—allowing illegal proceeds from scams and online gambling to be rapidly and repeatedly transferred out. By disguising the destinations of large criminal proceeds through layered transfers, the illegal fund flow involved in the case reached NT$36.4 billion.

Zhang Jiaqui, Deputy Director of the FSC Banking Bureau, said that, this case was discovered when the Banking Inspection Bureau found abnormal cash flows during its 2025 financial inspection and proactively referred the matter to investigators. After investigators launched searches, they seized nearly NT$2,691,000,000 in assets, and formally indicted 7 people involved for offenses including special breach of trust under the Banking Act and offenses under the Anti-Money Laundering Act.

• Related report: Shocking Taiwan’s financial industry! Six Taichung Bank executives colluded with a fraud group, helping launder NT$3.6 billion

FSC issues six supervisory requirements; Taichung Bank emphasizes normal operations

In response to the severe internal-control failure at Taichung Bank, the FSC, in addition to the heavy fine, also put forward six supervisory requirements. These include conducting a comprehensive review of the case-related deficiencies and studying ways to strengthen improvement measures; strengthening internal control and audit mechanisms and reporting them to the board of directors; conducting a comprehensive review of account-opening suitability for cases actively recruited by bank staff; and requiring that within 1 month, an external professional organization be hired to recalibrate and improve the bank’s anti-money laundering mechanism, among other measures.

In response to the FSC’s heavy fine and supervisory requirements, Taichung Bank subsequently issued a major information disclosure. It stated that it will carry out the relevant improvements in accordance with the instructions of the competent authority, and emphasized that the company’s operations are currently all normal, capital adequacy is sound, and the company’s overall financial and business situation has not been affected.