FCA gives Al Rayan Bank $4mn AML failings fine

FCA calls for input on data disparity between Big Tech and financial services
Credit: Ascannio, Shutterstock

A penalty of more than £4mn has been issued to Al Rayan Bank by the FCA in connection to AML control failings. 

The regulator detailed that between April 2015 and November 2017, Al Rayan had allowed certain funds to enter the UK without conducting the necessary procedures to check the source in accordance with local AML regulations. 

Further breaches were recorded when the bank’s staff was found lacking sufficient knowledge on how to process large deposits, additionally heightening the risk of financial crime. 

While continuous interactions between the FCA and Al Rayan have since shown improvements in the bank’s monitoring procedures, some restrictions still remain in place.

Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA, said: “Al Rayan failed to manage the risk that it might be used to facilitate money-laundering. 

“These failings create the conditions in which financial crime is facilitated and can take root within a firm. While the risk was caught in time, the failings here were egregious. 

“The FCA will continue to raise the stakes for firms that do not take their financial crime responsibilities seriously, especially in preventing money laundering risks which harms confidence and integrity in our market and in preventing financial crime, which is a key component in the FCA’s three-year strategy.” 

The £4,023,600 FCA-issued bill is actually 30% less from the £5,748,000 that Al Rayan would have had to pay if the bank did not agree with the regulator’s findings and refused to settle. 

Giles Cunningham, Chief Executive Officer at Al Rayan Bank, commented: “The FCA identified historic weaknesses in the Bank’s financial crime systems and controls that date back to a period between 2015 and 2017. 

“The FCA found no evidence of any money laundering or other criminal activity by the Bank nor its customers, and none of the bank’s existing management were in a senior management function at the time.

“The bank cooperated fully throughout and all identified weaknesses have been fully resolved with the support and assistance of external, independent subject matter experts.

“Maintaining strong defences against the evolving threats of financial crime is an essential part of our business plan and is being led by the new Board and Executive Team.

“The financial penalty will have no material impact. The bank remains well capitalised and will report very strong financial results for 2022.”