FCA Fines Al Rayan and Guaranty Trust Banks For AML Failures

The FCA has fined Al Rayan and Guaranty Trust banks over anti-money laundering (AML) failures.

In the first penalty, announced by the U.K.’s Financial Conduct Authority on Tuesday (Jan. 10), Guaranty Trust Bank (GTB), a multinational banking group headquartered in Lagos, Nigeria, has been fined £7,671,800 ($9.3 million) over “serious weaknesses” the regulator found in its AML systems between October 2014 and July 2019.

During that period, the FCA said that GTB failed to adequately assess the money laundering risk posed by customers. It added that the bank’s transaction monitoring processes were not up to the required standard either.

GTB’s latest fine is the second such penalty it has received from the FCA, following a £525,000 ($636,701) fine in August 2013 for “serious and systemic failings.”

Commenting on the recent fine, Mark Steward, FCA executive director of enforcement and market oversight, said, “GT Bank should have acted quickly to put in place adequate AML controls following its fine in 2013 but it failed to do so. GT Bank did not develop a plan that was capable of addressing its AML weaknesses, exposing it and the broader market to financial crime risks for a prolonged period.”

In the case of Al Rayan Bank, the FCA announced on Wednesday (Jan. 11) that it has issued the London-based bank with a 4,023,600 pound ($4.9 million) fine for not adequately checking the source of its customers’ wealth between April 1, 2015 and Nov. 30, 2017.

Those weaknesses were made worse by an alleged lack of proper staff training in handling large deposits, further heightening the risk of money laundering, the FCA said.

It added that the bank voluntarily agreed not to take on further high-risk customers following a visit from FCA officials in 2017. And while many of the initial restrictions have since been lifted, Al Rayan still remains subject to stricter rules until further improvements are made.

Neither GTB nor Al Rayan Bank has contested the FCA’s findings, qualifying them for a 30% discount. Had they not settled, GTB would have been liable to pay £10,959,700 ($13.3 million) and the Al Rayan Bank £5,748,000 ($7 million).

While hefty by most people’s standards, both penalties are small compared to the £107.7 million ($130.6 million) the FCA ordered Santander to pay for similar AML issues in December.


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