KUALA LUMPUR (Aug 26): PETRONAS-owned Setel Ventures Sdn Bhd and Standard Chartered have been fined for breaching targeted financial sanctions rules in Malaysia.

Setel, which develops and operates the Setel fuelling and mobility app, was ordered to pay RM637,500 to Bank Negara Malaysia (BNM) for failing to immediately update its sanctions database upon publication of the ‘domestic list’. Setel paid the penalty on May 6, the central bank said.

"Setel also failed to conduct sanctions screening of customers in its database and subsequently failed to ascertain whether potential matches were true matches,” BNM said in a statement on Wednesday.

The domestic list is a list of names and entities designated by the government under the law on anti-money laundering, anti-terrorism financing and proceeds of unlawful activities. Setel is regulated by the central bank as a non-bank electronic-money issuer and is also a registered merchant acquirer.

Setel is a wholly owned subsidiary of PETRONAS Dagangan Bhd (KL:PETDAG), which in turn is owned by the national oil company officially known as Petroliam Nasional Bhd.

BNM also announced that it has separately imposed penalties of RM132,000 on Standard Chartered Bank Malaysia Bhd and RM132,000 on its Islamic banking arm Standard Chartered Saadiq Bhd over similar violations. The fines were paid on June 15.

The breaches were discovered following an on-site supervisory examination on the bank also known as StanChart though none of the entities or persons in the domestic list were onboarded, and no transactions were facilitated, BNM noted.

All reporting institutions are required to “to maintain a high level of commitment in ensuring compliance” with the requirements, BNM said, adding that it will not hesitate to take appropriate actions on those who failed to meet the requirements.