The Monetary Conduct Authority (FCA) has fined Barclays a mixed £42 million for critical failings in its monetary crime threat administration, citing two separate circumstances involving WealthTek and Stunt & Co.
Barclays Financial institution UK PLC and Barclays Financial institution PLC had been sanctioned for insufficient controls that uncovered the financial institution and its purchasers to heightened dangers of cash laundering and fraud.
The regulator mentioned the financial institution didn’t conduct correct due diligence or take well timed motion even when crimson flags had been raised by regulation enforcement.
Within the first case, Barclays Financial institution UK PLC failed to assemble adequate details about WealthTek earlier than opening a shopper cash account. A fundamental examine of the Monetary Providers Register would have proven that WealthTek was not authorised by the FCA to carry shopper cash.
Regardless of this oversight, purchasers deposited £34 million into the account.
Following FCA intervention, Barclays agreed to make a voluntary cost of £6.3 million to WealthTek purchasers dealing with shortfalls. In December 2024, WealthTek’s principal accomplice was charged with a number of offences, together with fraud and cash laundering.
Within the second case, the FCA fined Barclays Financial institution PLC £39.3 million for failing to handle cash laundering dangers linked to its relationship with Stunt & Co, which acquired £46.8 million from Fowler Oldfield, a agency already beneath investigation for large-scale cash laundering.
Barclays didn’t collect adequate info on the outset of the connection and didn’t perform ample ongoing monitoring.
Even after receiving warnings from regulation enforcement and studying about police raids, the financial institution didn’t assess its publicity till the FCA prosecuted NatWest for the same relationship with Fowler Oldfield.
“The implications of poor monetary crime controls are very actual – they permit criminals to launder the proceeds of their crimes, and so they enable fraudsters to defraud customers,” mentioned Therese Chambers, Joint Government Director of Enforcement and Market Oversight on the FCA.
“Banks must take accountability and act promptly, significantly when apparent dangers are dropped at their consideration.”
The FCA famous that Barclays secured a big discount in its tremendous attributable to its cooperation throughout the investigation and the voluntary cost to affected customers.
Barclays is constant a large-scale remediation programme to strengthen its anti-money laundering (AML) management framework.
The FCA has flagged monetary crime as a key focus in its 2024 supervisory technique and mentioned it might proceed to observe banks to make sure methods and controls are as much as customary.
