FCA Fines Santander UK £108 Million for Prolonged AML Breaches

The United Kingdom’s Financial Conduct Authority (FCA) has fined Santander UK Plc more than £107.7 million for some severe lapses in anti-money laundering (AML Anti-Money Laundering (AML) Anti-money laundering (AML) is a term that describes laws, processes, and regulations that are intended to prevent illegally obtained funds from being disguised as income gained through legitimate means. The fundamental purpose of the AML laws is to help safeguard, detect, and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.Most exchanges have AML measures that include identity verification Anti-money laundering (AML) is a term that describes laws, processes, and regulations that are intended to prevent illegally obtained funds from being disguised as income gained through legitimate means. The fundamental purpose of the AML laws is to help safeguard, detect, and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.Most exchanges have AML measures that include identity verification Read this Term) controls, the regulator announced on Friday.

The UK unit of Santander failed to properly oversee and manage its AML systems for almost five years, from 31 December 2012 to 18 October 2017. These lapses impacted the oversight of more than 560,000 business customers.

The regulator detailed that Santander’s AML systems in place could not adequately verify the business information provided by the customers. In addition, it failed to properly monitor the expected money into these accounts compared to the actual deposits.

Money-Laundering Risks

The FCA even identified several business banking accounts that Santander failed to identify correctly, including a small translation business that expected monthly deposits of £5,000 but was receiving millions of pounds within six months. Though the bank’s AML team recommended closing the account on March 2014, nothing was done until September 2015. The bank also agreed to FCA’s request in September 2015 to keep the account open but lost track of the regulatory request later.

All of the AML compliance Compliance In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a Read this Term failures led to more than £298 million in transactions before the accounts were closed.

“Santander’s poor management of their anti-money laundering systems and their inadequate attempts to address the problems created a prolonged and severe risk of money laundering and financial crime,” said Mark Steward, the Executive Director of Enforcement and Market Oversight.

Earlier, the FCA imposed heavy penalties on other big banks operating within its jurisdictions. It fined Standard Chartered Bank £102.2 million and HSBC Bank plc £63.9 million. The largest sum of the penalty was £264.8 million against NatWest.

“As part of our commitment to prevent and reduce financial crime, we continue to take action against firms which fail to operate proper anti-money laundering controls,” Steward added.