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UK: Failing in the Financial Crime Compliance 2023

Friday 20 January 2023


The UK’s Financial Conduct Authority (FCA) has already listed two penalties related to financial crime.
AL Rayan Bank PLC and Guaranty Trust Bank have breached principle 3 concerning financial crime compliance.    
In the FCA handbook, principle three is related to management and control:
A firm must take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems.

The British conduct authority has fined £4,023,600 (just over $ 7 million)  AL Rayan for failing to adequately check the source of funds and wealth between April 2016 and November 2017. 
The FCA alleged had  AL Rayan bank not settled would have been fined £5,748,000 (just over  $10 million)
Guaranty Trust Bank has been fined £7,671,800 (almost  $14 million) for inadequate risk assessments and transaction monitoring between 2014 and 2019. 

The conduct regulator called these failures 'egregious' because ten years ago, the bank faced a £525,000 fine ($939,671) for ‘serious and systemic failings’. 
For 2022 FCA listed five financial institutions with  financial crime-related penalties:

  • Santander UK
  • Gatehouse bank
  • TJM partnership
  • Ghanian International Bank
  • Barclays Bank
Santander faced the most significant penalty of £107,793,300 (almost $200 million) for ineffective verification processes and transaction monitoring systems between 2012 and 2017. 
FCA said in a formal statement, "The FCA identified several other Business Banking accounts which Santander failed to manage correctly, leaving the bank open to serious money laundering risk.”