Barclays fined £42m for poor money laundering checks

Barclays Bank has been fined £42m by the UK’s financial watchdog for failures in its money laundering risk management.

The Financial Conduct Authority (FCA) said Barclays had not properly vetted two of its clients, Stunt & Co and WealthTek.

The FCA said Barclays “facilitated the movement of funds linked to financial crime” by providing services to Stunt & Co and said there was “an increased risk” of client money misappropriation or money laundering from its failure to check WealthTek.

Barclays said it fully co-operated with both investigations and has “further strengthened its financial crime and other control capabilities”.

The regulator said “one simple check” Barclays could have done on WealthTek was to look at the Financial Services Register.

“Had it done so, it would have seen that WealthTek was not permitted by the FCA to hold client money,” the FCA said.

It went on to say that it failed to carry out “proper ongoing monitoring” of its account with Stunt & Co.

“In the space of just over a year, Stunt & Co received £46.8 million from Fowler Oldfield, a multimillion-pound money laundering operation,” the regulator said.

Therese Chambers, from the FCA’s enforcement division, said Barclays got a significant reduction in its fine through its “extensive co-operation” in the investigation of WealthTek and making a voluntary payment to affected clients, although further details were not given.

The bulk of the fine, £39.3m, was in relation to Stunt & Co.

In November, the FCA UK’s fined Barclays £40m over the bank’s conduct during a fundraising drive in 2008, which it described as “reckless” and lacking integrity.

The FCA said the bank failed to disclose arrangements with Qatari investors when it was looking to raise money at the height of the financial crisis.

Barclays said it “remains deeply committed to the fight against financial crime and fraud.”

“The FCA’s investigation relating to Stunt & Co was centred around historical money laundering activity and made no findings that the bank had breached money laundering regulations,” it said in a statement.

“As acknowledged by the FCA, Barclays undertook an extensive review and self-reported its findings to the FCA”, it added.