Barclays Bank has been fined £42m for two separate situations of financial crime risk failures by the Financial Conduct Authority.
In the primary case, the City watchdog says, Barclays did not verify that it had gathered ample info to grasp the cash laundering risk earlier than opening a shopper cash account for UK-based cash supervisor WealthTek.
The regulator provides: “One easy verify it might have carried out was to have a look at the financial providers register earlier than opening the account.
“Had it carried out so, it will have seen that WealthTek was not permitted by the Financial Conduct Authority to carry shopper cash.”
The watchdog provides that with out the correct details about WealthTek and the way the account could be used, “there was an elevated risk of misappropriation of shopper cash or cash laundering”.
Clients went on to deposit £34m into the account. Barclays has agreed to make a voluntary fee of £6.3m to WealthTek’s shoppers who’ve a shortfall within the cash they’ve been capable of reclaim.
Last December, the regulator individually charged WealthTek’s principal accomplice, John Dance, with 9 prison offences, together with a number of counts of fraud and cash laundering.
In the second case, the FCA fined Barclays Bank £39.3m for “failing to adequately handle cash laundering dangers” related to offering banking providers to agency Stunt & Co.
The watchdog says that Barclays didn’t collect sufficient info at first of the connection or perform correct ongoing monitoring.
In the house of simply over a 12 months, Stunt & Co acquired £46.8m from Fowler Oldfield, a multimillion-pound cash laundering operation.
“Barclays did not correctly contemplate the cash laundering dangers related to the agency even after receiving info from regulation enforcement about suspected cash laundering via Fowler Oldfield, and after studying that the police had raided each corporations,” the watchdog says.
It factors out: “Barclays solely performed a assessment of its publicity to Fowler Oldfield via its prospects, together with Stunt & Co, after it discovered of the Financial Conduct Authority’s resolution to prosecute NatWest over their relationship with Fowler Oldfield.
“By offering ongoing banking providers to Stunt & Co, Barclays facilitated the motion of funds linked to financial crime.”
FCA joint government director of enforcement and market oversight Therese Chambers says: “The penalties of poor financial crime controls are very actual – they permit criminals to launder the proceeds of their crimes, and so they enable fraudsters to defraud shoppers.
“Banks have to take duty and act promptly, significantly when apparent dangers are dropped at their consideration.
“In the primary of those circumstances, Barclays secured a major discount in its effective via its in depth cooperation with our investigation and thru making a voluntary fee to affected shoppers at our request.”
The watchdog provides that Barclays continues to spend money on “a major remediation programme” to spice up its anti-money laundering management framework.
Last week, digital financial institution Monzo was fined £21m for related failings by the City watchdog.
