The latest compliance news: regulatory developments, punishments, guidance, permissions and new product and service offerings.
Financial Conduct Authority, Gatehouse Bank
The Financial Conduct Authority has fined Gatehouse Bank £1,584,100 ($1,771,028) for “significant weakness” in its financial crime systems and controls.
Between June 2014 and July 2017 Gatehouse failed to conduct sufficient checks on its customers based in countries with a higher risk of money laundering and terrorist financing, the UK regulator said in a statement late last week.
“Gatehouse also failed to undertake the correct checks when some of the customers were classed as Politically Exposed Persons,” the FCA said.
In one instance, Gatehouse Bank set up an account for a company based in Kuwait to aggregate customer funds. Gatehouse Bank did not require the company to collect information about customers’ source of funds or wealth, which was required under Gatehouse’s anti-money laundering policies, it said. Over a two-year period, Gatehouse accepted $62,000,000 into the account without properly vetting the funds for financial crime risks, it said.
The FCA said that Gatehouse has “taken significant steps” to improve its financial crime systems and controls.
"Gatehouse Bank’s failures exposed itself to the risk that it might be used as part of a laundering process for illegal funds. While not deliberate, there can be no excuse for failures as serious as this,” Mark Steward, executive director of enforcement and market oversight, said.