UK fines Barclays US$56 million for lapses in financial crime control

[LONDON] Britain’s financial regulator fined Barclays US$56 million on Wednesday (Jul 16) for failing to evaluate money laundering risks while providing services to its clients Stunt & Co and WealthTek.

The biggest portion of the fine is related to its banking relationship with gold bullion business Stunt & Co, a customer of Fowler Oldfield, which was linked to a major money laundering operation.

“Barclays did not gather enough information at the start of the relationship or carry out proper ongoing monitoring,” the Financial Conduct Authority (FCA) said.

Barclays failed to properly vet Stunt & Co, the FCA said, even though Stunt & Co received £46.8 million (S$80.5 million) from Fowler Oldfield. Barclays continued offering services despite police raids and regulatory warnings.

Stunt & Co is currently under liquidation.

The FCA said Barclays only reviewed its exposure to Fowler Oldfield after learning of the regulator’s decision to prosecute NatWest over its ties to the same firm.

“By providing ongoing banking services to Stunt & Co, Barclays facilitated the movement of funds linked to financial crime,” FCA said.

A Barclays spokesperson said the bank undertook an extensive review and self-reported its findings to the FCA and has fully cooperated with its investigations.

While Barclays was fined for failing to manage financial crime risks, the spokesperson noted that the investigation relating to Stunt & Co “made no findings that the bank had breached money laundering regulations.”

In relation to WealthTek, the financial watchdog had charged John Dance, former principal partner at the wealth management firm, with fraud and laundering more than £64 million from client accounts last December.

The FCA said Barclays would have seen that WealthTek was not permitted to hold client money had the lender checked the Financial Services Register before opening the account. REUTERS