The Financial Conduct Authority (FCA) has fined Ghana International Bank £5,829,900 for poor AML and CTF controls over its correspondent banking activities.
According to the FCA, GIB provided correspondent banking services to overseas banks, which allowed them to provide products and services they would not otherwise be able to. The FCA requires banks to do extra checks on their correspondent banking customers to reduce the higher risk of AML/CTF associated with the service.
However, the FCA found that between 1 January 2012 and 31 December 2016, GIB did not perform adequately the additional checks required when it established relationships with the overseas banks and failed to demonstrate it had assessed those banks’ AML controls.
GIB also failed to undertake yearly reviews of the information it held on the banks it had a relationship with, failed to give staff adequate training on how to scrutinise transactions properly and did not establish appropriate policies and procedures for staff.
In December 2016, the FCA visited GIB to review its financial crime controls. Due to concerns identified during this visit, GIB voluntarily agreed not to take on new customers – a restriction that remains in place.
While there was no evidence of actual money laundering being detected, the risk of money laundering as a result of these deficiencies was significant. GIB did not dispute the findings and agreed to settle at the earliest possible opportunity, which meant it qualified for a 30% discount.
FCA executive director of enforcement and market oversight Mark Steward said, “Firms are gatekeepers of the financial system and have vital obligations to ensure they are not used to facilitate or perpetrate financial crime. These failings meant that GIB was unable to identify and assess the risks posed by its correspondent bank customers and properly scrutinise transactions worth £9.5 billion processed on their behalf during the relevant period. Ensuring firms strengthen their anti-money laundering controls and enforcing failures to comply remain high priorities for the FCA.”
President of China Xi Jinping recently approved a plan to standardise and develop regulations for the FinTech sector, MarketWatch has reported.
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Copyright © 2018 RegTech Analyst
