Context
FCA Executive Director of Enforcement and Market Oversight, Mark Steward, gave a speech on 24th March 2021 at the AML and ABC Forum.
Key points to note
Detection, investigation and prosecution, where necessary, – either civilly or criminally – of breaches of the Money Laundering Regulations, SYSC 6.3 and/or the Principles for Businesses are key priorities for the FCA.
Recently the FCA commenced its first criminal proceeding against a bank under the Money Laundering Regulations 2007. As has been widely reported, the case is concerned with the bank’s systems and controls to monitor and scrutinise significant levels of cash deposited by a UK incorporated customer.
Some highlights:
- Within the last 12 months two of the biggest sanctions were in relation to failures to address financial crime and anti-money laundering (AML) risks.
- At present the FCA has 42 investigations ongoing into firms and individuals involving, for example, systems and controls over politically exposed persons, customers with significant cash intensive operations, correspondent banking and trade finance, and transaction monitoring.
- AML investigations are often complex because they are rarely transactional and require a systemic understanding of how a firm operates, its governance controls, its cultural habits, and the nuts and bolts of sometimes opaque systems.
- In the last 12 months the FCA has increased its surveillance of online investment promotions targeting offers from unauthorised firms, potential investment scams and other too good to be true promotions, including lead generation sites.
Next actions
Firms should consider a proportionate assessment of their anti-money laundering controls in light of the content of this speech.