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Standard Bank fined $12.6m for poor anti-laundering controls

Mike Cohen

The UK's Standard Bank has been fined $12.6-million by the Financial Conduct Authority for failing to implement adequate anti-laundering controls.

Standard Bank Plc in the UK is a subsidiary of Standard Bank Group in South Africa. (Gallo)

Standard Bank Plc was fined £7.6-million ($12.6-million) by the UK Financial Conduct Authority (FCA) for failures in its anti-money laundering controls, the first fine of its kind by the regulator.

Standard Bank, the UK subsidiary of South Africa's Standard Bank Group Ltd, didn't have adequate policies or procedures to protect corporate customers connected to political figures in relation to anti-money laundering, the FCA said in an emailed statement. Corporate customers connected to well-known public individuals are at higher risk and subject to tighter controls, the regulator said.

"Banks are in the front line in the fight against money laundering. If they accept business from high-risk customers they must have effective systems, controls and practices in place to manage that risk," said Tracey McDermott, FCA Director of Enforcement and Financial Crime. "Standard Bank clearly failed in this respect."

Standard Bank failed to comply with money laundering regulations between December 2007 and July 2011, the FCA said.

The fine is the first anti-money laundering case under the watchdog's increased penalty powers, which apply to violations committed after March 6 2010.

The bank received a 30% discount for settling early, reducing the fine from £10.9-million.

"Standard Bank and its senior management have cooperated with the authority's investigation and have taken significant steps at significant cost towards remediating the issues identified," the bank said in an emailed statement. – Bloomberg

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