The Financial Conduct Authority (FCA) has issued a £42m fine to Barclays Bank UK PLC and Barclays Bank PLC over two separate cases of serious failings in financial crime risk management, involving WealthTek and Stunt & Co.
Barclays Bank UK PLC was penalised for opening a client money account for WealthTek without conducting the necessary checks to assess money laundering risks. The bank failed to confirm whether WealthTek was authorised by the FCA to hold client money. A simple review of the Financial Services Register would have revealed that WealthTek lacked the required permissions. As a result, clients deposited £34m into an account that posed an increased risk of money laundering or misuse of funds.
To compensate affected clients, Barclays has agreed to make a voluntary payment of £6.3m to cover shortfalls in funds they were unable to recover. This follows the FCA’s criminal charges in December 2024 against WealthTek’s principal partner, who now faces multiple offences including money laundering and fraud.
The second case involves Barclays Bank PLC and its dealings with Stunt & Co. The FCA fined the bank £39.3m for failing to conduct adequate due diligence or maintain effective ongoing monitoring of the client relationship. Within just over a year, Stunt & Co received £46.8m from Fowler Oldfield, which was later exposed as a multimillion-pound money laundering operation.
Despite receiving warnings from law enforcement and learning that police had raided both companies, Barclays did not reassess the risks posed by Stunt & Co until after the FCA’s decision to prosecute NatWest for its ties to Fowler Oldfield. This delayed response meant Barclays continued to facilitate the flow of potentially illicit funds.
FCA joint executive director of enforcement and market oversight Therese Chambers said, “The consequences of poor financial crime controls are very real – they allow criminals to launder the proceeds of their crimes, and they allow fraudsters to defraud consumers. Banks need to take responsibility and act promptly, particularly when obvious risks are brought to their attention.
“In the first of these cases, Barclays secured a significant reduction in its fine through its extensive co-operation with our investigation and through making a voluntary payment to affected consumers at our request.”
Barclays has stated that it continues to engage with the regulator and is actively investing in a large-scale remediation programme to strengthen its anti-money laundering framework.
The FCA has reaffirmed that tackling financial crime remains a top supervisory priority for retail banks in 2024, with a continued focus on ensuring robust systems and controls are in place.
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