Barclays Bank has paid a penalty of A$80,000 (US$81,000) to the Australian Securities and Investments Commission, for erroneously withdrawing client monies from the Barclays' Client Segregated Account, instead of its own account.

The UK lender was rapped for withdrawing $A13.8 million of client assets from its Sydney Client Segregated Account to be received by the London office,  on 27 January 2011, and failing to return the client monies for five business days.

In determining the appropriate penalty in this matter, the Markets Disciplinary Panel took into account all relevant guidance in ASIC Regulatory Guide, in particular the strict, mandatory obligation on participants to hold and use client monies only as permitted.

"Barclays ultimately rectified the situation five business days after it was first identified. Barclays’ clients could potentially have suffered damage if Barclays had become insolvent during the five day period from the day the client monies were erroneously withdrawn to the day the client monies were deposited into the CSA," said ASIC.

The blunder happened despite Barclays undertaking an independent review of its policies and procedures around client monies since 2008. This involved implementing additional controls around its handling of client money, conducting training to relevant staff around handling of client money and recruiting additional senior experienced staff to provide closer oversight.

Barclays self reported the breach to ASIC on 17 February 2011, fourteen days after the breach was first identified, which was an unacceptable delay in the circumstances, said ASIC, adding that Barclays had collaborated in the investigation.