The Financial Conduct Authority (FCA) has fined Guaranty Trust
Bank (UK) Limited (GT Bank) £7,671,800 for serious weaknesses in
its anti-money laundering (AML) systems and controls between
October 2014 and July 2019.
During the relevant period, GT Bank failed to undertake adequate
customer risk assessments, often not assessing or documenting the
money laundering risks posed by its customers.
The bank also failed to monitor customer transactions and
business relationships to the required standard.
These weaknesses were repeatedly highlighted to GT Bank by
internal and external sources, including the FCA, but despite
this, GT Bank failed to take appropriate action to fix them.
From early 2018 GT Bank stopped taking on new customers. Later
that year GT Bank agreed to wider voluntary restrictions on
business, given the FCA’s ongoing concerns. Requirements remained
in place until the middle of 2021 when they were lifted after the
bank completed a remediation plan, checked by an independent
third party.
GT Bank’s conduct is particularly egregious as this is not the
first time that the bank has faced enforcement action in relation
to its AML controls, with the FCA fining GT Bank £525,000 in
August 2013 for serious and systemic failings.
The FCA requires firms to have in place effective AML controls to
mitigate the risk of individuals and organisations using
financial institutions to circumvent restrictions designed to
prevent them benefitting from assets obtained by illegal means.
Mark Steward, Executive Director of Enforcement and
Market Oversight at the FCA, said:
“GT Bank should have acted quickly to put in place adequate AML
controls following its fine in 2013 but it failed to do so. GT
Bank did not develop a plan that was capable of addressing its
AML weaknesses, exposing it and the broader market to financial
crime risks for a prolonged period.
“Firms must protect themselves and those dealing with them from
financial crime risks, especially money laundering. The FCA is
determined to ensure the market for financial services is safe,
clean and trusted with robust systems and controls in place to
stymie financial crime. The FCA will continue to take action when
these standards are not met.”
GT Bank has not disputed the FCA’s findings and agreed to settle,
which means it has qualified for a 30% discount. Without this
discount, the financial penalty would have been £10,959,700.
Notes to editors:
- GT Bank is a wholly owned subsidiary of Guaranty Trust Bank
Nigeria Limited, which is a wholly owned subsidiary of Guaranty
Trust Bank Holding Company Plc., a Nigerian multinational
financial services institution that provides a range of banking
services across Africa and the United Kingdom. Guaranty Trust
Bank Holding Company Plc is a public limited company, listed on
both the London and Nigerian stock exchanges.
-
Final Notice for GT
Bank.
- On 8 August 2013, the FCA issued a Final Notice and imposed a financial
penaltyof £525,000 on GT Bank for failing to maintain
adequate AML systems and controls between 19 May 2008 and 19
July.
- In early 2018, GT Bank suspended onboarding of new customers.
In May 2018 a Skilled Person report was produced which
highlighted significant deficiencies regarding GT Bank’s AML
systems and controls. GT Bank then agreed to the voluntary
imposition of wider requirements on its business on 13 November.
- Following improvements made to its AML systems and controls,
requirements were lifted after GT Bank completed a remediation
plan, which was verified by a Skilled Person.
- Reducing and preventing financial crime is a key part of the
FCA’s three-year strategy to
prevent serious harm and set higher standards in financial
markets.
