You are here: Home - News -

FCA fines Barclays £783,800 in Premier FX case

  • 28/02/2022
  • 0
FCA fines Barclays £783,800 in Premier FX case
The Financial Conduct Authority (FCA) has fined Barclays Bank £783,800 for failing to properly oversee its business with Premier FX, which collapsed in 2018.

Barclays agreed to cover more than £10m in losses by Premier FX customers.

The financial regulator said that Barclays, Premier FX’s sole banker in the UK, had neglected to identify that internal controls at the payments firm were deficient and that Barclays had failed in this case to conduct its business with due skill, care and diligence.

While the liquidator was to distribute 9p for every £1 customers had lost, Barclays has agreed to make up the difference with what the FCA said was a voluntary payment of £10,076,943.75, meaning that the 167 Premier FX clients whose claims had been accepted by liquidators would have 100 per cent of their money returned. 

Mortgage Solutions approached Barclays for comment. A spokesperson for the bank responded: “Barclays has reached a resolution with the FCA following an investigation into its oversight and monitoring of a former customer, Premier FX Limited. As part of this resolution, Barclays has agreed to pay a penalty of £783,800 and make an ex gratia payment to be distributed amongst Premier FX’s customers.

“Barclays fully cooperated with the FCA’s investigation.”

The FCA said the Barclays payment would be sent by the liquidators by the end of next month and that the fine ended the watchdog’s investigation into Premier FX and associated parties. 

The FCA publicly censured Premier FX in February 2021 for failing to safeguard its customers’ money and seriously misleading them about the services it was authorised to provide. 

The regulator said that Premier FX had seriously misled customers on three levels, falsely telling them that it could hold their funds indefinitely without the need for a payment order for onward transfer; that their funds would be held in secure, segregated client accounts; and that their funds would be protected by the Financial Services Compensation Scheme (FSCS).

Mark Steward, executive director of enforcement and market oversight for the FCA, said: “Premier FX, which handled money on behalf of other people, presented particularly high risks of financial crime and fraud. Barclays was aware of these high risks in providing banking services to Premier FX but failed to take reasonably appropriate steps to mitigate those risks.”

He added however, that Barclays’ agreement to “meet the deficiency in Premier FX’s funds mitigates the actual losses to Premier FX’s customers” and was “a significant step to the credit of the bank” and one which “has reduced substantially the sanction that otherwise would have been imposed.”

There are 0 Comment(s)

You may also be interested in