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FCA AML Investigation Failures: 2 Banks Fined Millions in same 24 Hrs

Author: Dr. Angelika Hellweger  25 January 2023

Angelika Hellweger, of financial crime specialists Rahman Ravelli, considers the cases.

The UK’s Financial Conduct Authority (FCA) fined two banks millions within a day of each other for money laundering shortcomings.

Al Rayan Bank, which is owned by Qatar’s second-largest bank, Masraf Al Rayan, was fined £4 million for its anti-money laundering failings between 2015 and 2017. A day earlier, the FCA announced it had ordered GT Bank, -a subsidiary of Guaranty Trust Bank Nigeria Limited - to pay £7.6 million for weaknesses in its anti-money laundering controls between 2014 and 2019.

Neither bank disputed the FCA’s findings, which resulted in a reduction in their fines.

The FCA was particularly critical of Al Rayan’s failure to carry out comprehensive checks on the sources of funds when dealing with high net worth clients. The regulator stated that the bank had relied on due diligence conducted by financial institutions in Gulf Co-operation Council states, had a backlog of high-risk customer checks and had not properly trained staff.

According to the FCA, GT Bank was warned about weaknesses in its anti-money laundering, sanctions and terrorist financing systems but did nothing to address them in three years. The bank had been fined £525,000 by the FCA for similar failings in 2013.

Mark Steward, the FCA’s Executive Director of Enforcement and Market Oversight, said: “Firms must protect themselves and those dealing with them from financial crime risks, especially money laundering,”

He added that failings such as Al Rayan’s “create the conditions in which financial crime is facilitated,” and that GT Bank’s lacklustre anti-money laundering protocols meant that it exposed itself “and the broader market to financial crime risks for a prolonged period.”

Both cases indicate the FCA’s willingness to take action where it finds banks failing to meet their obligations – and the need for banks to do all they can to avoid such an outcome.

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Dr. Angelika Hellweger

Legal Director

angelika.hellweger@rahmanravelli.co.uk
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Angelika is a specialist in international, high-level economic crime investigations and large-scale commercial disputes. She has widely-recognised expertise in representing corporates and conglomerates in Europe, the Middle East, Africa and United States.

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