The FCA has imposed a £102,163,200 fine on Standard Chartered Bank for Anti-Money Laundering breaches in two higher risk areas of its business. The shortcomings uncovered by the FCA during their investigation into the firm relate to their UK Wholesale Bank Correspondent business and its branches in the United Arab Emirates (UAE).
The significant failings centred around Standard Chartered’s approach to identifying and mitigating material money laundering risks, as well as falling short of their obligation to establish appropriate and risk-sensitive procedures under the Money Laundering Regulations (MLR) 2007.
Who does it impact?
This fine by the FCA should act as a warning to all financial institutions regulated by the FCA to ensure their approach to AML complies with the more stringent standards of MLR 2017. Under MLR 2017, firms are required to establish and maintain policies, procedures and controls to effectively mitigate the money laundering and terrorist financing risks identified in their business-level risk assessment.
What you need to do?
Firms should consider how they undertake and evident their risk-based approach to money laundering. This case has highlighted the importance for firms to:
- Conduct an assessment of the firm’s risk to money laundering and terrorist financing;
- Ensure controls are proportionate to the firm’s size, nature and exposure to risk;
- Where the firm has branches or subsidiaries outside the UK, implement a monitoring framework to ensure those branches follow the firm’s policies and procedures; and
- Review and amend the firm’s policies, procedures and controls on a regular basis to address any identified weaknesses
How can Thistle help you?
If you are concerned whether your firm is implementing a compliant risk-based approach to money laundering and terrorist financing, Thistle will be able to offer our expert support guidance.
Our financial crime team will be able to offer a tailored solution to suit your needs, which could include undertaking an audit of your financial crime controls, providing template policies or implementing a proportionate AML framework. Visit our Financial Crime page for further information on our services.
Contact us today on firstname.lastname@example.org or call 0207 436 0630.