UAE's DFSA bars HDFC DIFC from onboarding new clients over mis‑selling
DIFC compliance teams must stop onboarding new clients immediately
Change
UAE's DFSA in September barred HDFC Bank's Dubai International Financial Centre (DIFC) branch from onboarding new clients or conducting fresh business, citing a failure to escalate alleged mis‑selling of Credit Suisse additional tier‑1 (AT1) bonds for over five years and breaches of integrity standards.
Why it matters
The DFSA found HDFC DIFC's senior management and control functions incapable of identifying and resolving client‑onboarding and sales breaches and said the branch failed to be open and cooperate and to observe standards of integrity and fair dealing. HDFC's ethics committee and a Staff Accountability Report concluded incorrect practices were deliberate, identified weak or missing client records, and independent probes by Deloitte and Kroll examined the branch's conduct.
Implications
- — DIFC branch relationship managers and operations teams must cease onboarding new clients and halt fresh business immediately — continuing to onboard would breach the DFSA order and expose the branch to further regulatory enforcement.
- — Compliance and internal audit teams at HDFC Bank (group and DIFC) must immediately preserve and produce all client‑onboarding records from April 1, 2017 to March 31, 2024 and cooperate with DFSA and independent investigations — failure to do so risks additional sanctions and accountability findings.
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Source
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