In 2013, the regulator also warned a further four banks they were vulnerable to money laundering.
The regulator fined EFG Private Bank £4.2m in April 2013 for weaknesses in its anti-money laundering controls. The previous year, it slammed Coutts & Co with a £8.75m penalty for weak controls over high risk customers.
It also fined Habib Bank £542,500, including a £17,500 fine for its anti-money laundering boss, and Turkish Bank £294,000.
FCA director of enforcement and financial crime Tracey McDermott said: “Anti-money laundering rules are in place to protect all of us from the actions of criminals. Firms must take their anti-money laundering responsibilities seriously, and ensure they manage their money laundering risks adequately. We will do all we can to make sure they do.”
The FCA also warned four banks this year they were at risk of money laundering. After the FCA’s early intervention, one large bank decided to step away from a quarter of 1,500 customer relationships. In a third of these decisions, the reason was the high risk of money laundering.
More widely, roughly half of banks had no clear policy for dealing with trade-based money laundering risks, according to the FCA’s latest inspections. Many were unable to show they had taken the risk into account when processing particular transactions or even made effective use of customer checks compiled by staff in other parts of the bank.
In some cases, bank staff dismissed allegations about their customers and appeared to be overly close to high risk individuals, the regulator found.
Each year £10bn of illicit funds pass through the part of the financial services sector subject to money laundering regulations, according to Treasury estimates. This ‘regulated sector’ does not include mortgage brokers.
Growing risks include cybercrime and digital currencies that are currently unregulated by the FCA. According to government data, the financial services sector suffers the fifth highest number of cyber-attacks against its computer systems of any sector.
