Financial Regulatory Authority Issues £42 Million Penalty to Barclays
In a series of financial missteps, Barclays Bank UK PLC has been hit with significant fines by the Financial Conduct Authority (FCA) for failings in financial crime risk management in two separate cases.
Firstly, Barclays Bank UK PLC opened a client money account for WealthTek, a firm not authorised to hold client money. The bank failed to check it had gathered sufficient information to understand the money laundering risk beforehand. As a result, clients deposited £34 million into the account, and the bank later agreed to make a voluntary payment of £6.3 million to WealthTek’s clients to cover shortfalls.
The FCA fined Barclays a total of £42 million for this oversight, with a reduced fine of £3.1 million (originally £4.4 million) following an early settlement discount. The bank's principal was charged with criminal offenses, including money laundering and fraud, in December 2024.
In a separate incident, Barclays Bank PLC was fined £39.3 million (originally £56.2 million, with a settlement discount) for inadequate anti-money laundering controls regarding its services to Stunt & Co, a gold refining and trading company. The bank failed to perform adequate customer due diligence, assigning Stunt & Co a low-risk rating despite red flags such as links to high-risk jurisdictions and adverse media. Stunt & Co received £46.8 million in suspicious transfers connected to money laundering linked to Fowler Oldfield Ltd.
Barclays did not gather enough information at the start of the relationship or carry out proper ongoing monitoring for Stunt & Co. The bank has agreed to make a voluntary payment of £6.3 million to WealthTek's clients who have a shortfall in the money they have been able to reclaim.
The FCA's actions serve as a reminder for financial institutions to prioritise anti-money laundering measures and conduct thorough due diligence before opening client accounts to prevent such incidents in the future.
[1] Source: Financial Conduct Authority (FCA) press release, date unknown [2] Source: The Guardian, "Barclays fined £42m over money laundering failures", 18th February 2025 [3] Source: City A.M., "Barclays fined £39.3m over money laundering failings", 18th February 2025 [4] Source: BBC News, "Barclays fined £42m over money laundering failings", 18th February 2025
- The Financial Conduct Authority (FCA) has emphasized the importance of robust anti-money laundering measures in the banking-and-insurance industry, following Barclays Bank UK PLC's failings in financial crime risk management.
- Besides the £42 million fine for mismanaging client money with WealthTek, Barclays Bank UK PLC's principal faced criminal charges, including money laundering and fraud, in a case that surfaced in December 2024.
- In another event, Barclays Bank PLC was fined £39.3 million for inadequate anti-money laundering controls regarding its services to Stunt & Co, a gold refining and trading company with links to high-risk jurisdictions and adverse media.
- General news outlets such as The Guardian, City A.M., and BBC News reported that these incidents underscored the need for financial institutions to conduct thorough due diligence before opening client accounts to avoid money laundering-related events.
