The UK's Financial Conduct Authority has fined Metro Bank £16m after it failed between June 2016 and December 2020 to have the right systems and controls to adequately monitor over 60m transactions, with a value of over £51bn, for money laundering risks.
In a statement today (12 November), the regulator said Metro automated the monitoring of customer transactions for potential financial crime in June 2016. However, its system did not work as intended. An error in how data was fed into the system meant transactions taking place on the same day an account was opened, and any further transactions until the account record was updated, were not monitored.
Junior staff did raise concerns about some transaction data not being monitored in 2017 and 2018, but these did not result in the issue being identified and fixed. Even once a fix had been put in place in July 2019, Metro did not have a mechanism to consistently check that all relevant transactions were being fed into the monitoring system until December 2020, over four and a half years after the system was implemented.
Therese Chambers, joint executive director of enforcement and market oversight, said: "Metro's failings risked a gap being left in our defence against the criminal misuse of our financial system. Those failings went on for too long."
Since the firm’s identification of the issues with its transaction monitoring system in April 2019, the FCA further said that Metro had put in place processes to remediate the issues identified.
Metro Bank breached Principle 3 of the FCA’s Principles for Businesses – management and control.
Metro Bank would have been fined £23,821,700, but it agreed to resolve these matters and so qualified for a 30% discount under the FCA’s processes.
