The bank, previously Royal Bank of Scotland admitted that it failed to comply with the rules over a four-year period between November 2012 and June 2016.
That’s a blow to Alison Rose, the newish chief executive trying to reinvent the bank that went bust under the leadership of Fred “The Shred” Goodwin and had to be bailed out by the taxpayer.
The fine could be several hundred million pounds, one of the FCA’s biggest. The bank admitted to charges that it failed to prevent money laundering at an English gold dealer. The lender took in £365 million pounds in deposits over five years, despite the gold dealer indicating an annual revenue of just £15 million a year.
Watchdogs across the globe are issuing stringent penalties for money laundering, a crime they fear is spiralling out of control.
In August, a report by risk consultancy Kroll found that authorities had levelled $1 billion of anti-money laundering penalties in just the first six months of 2021.
The Financial Conduct Authority, the City watchdog, will be keen to send a signal that enforcement is a top priority and that failures will be punished.
Rose said: “We deeply regret that NatWest failed to adequately monitor and therefore prevent money laundering by one of our customers between 2012 and 2016. NatWest has a vital part to play in detecting and preventing financial crime and we take extremely seriously our responsibility to prevent money laundering by third parties.”
NatWest said it cooperated with the regulator and says it does not expect other authorities to get involved.
The case will go to the Crown Court for sentencing in four to eight weeks time. No NatWest employees are expected to be charged.
Lawyers for the FCA say the fine might be as much as £340 million.
The bank notes that it has more than 5000 staff in financial crime roles, dedicated to preventing scams, cyber- attacks and money laundering.
Rose added: “In the years since this case, we have invested significant resources and continue to enhance our efforts to effectively combat financial crime. We work tirelessly with colleagues, other banks, industry bodies, law enforcement, regulators, and governments to help find collaborative solutions to this shared challenge. These partnerships are crucial to counter the significant and evolving threat of financial crime to society.”
Earlier this year Monzo, the digital lender, revealed that it is being investigated by the FCA over potential money laundering failures.
Dutch lender ABN Amro earlier reached a e480 million settlement with prosecutors