FCA penalises bank for compliance breaches involving WealthTek and Stunt & Co
Barclays Bank UK PLC and Barclays Bank PLC have been fined a combined £42 million by the Financial Conduct Authority (FCA) for shortcomings in their financial crime risk management, with separate incidents involving WealthTek and Stunt & Co.
The FCA found that Barclays Bank UK PLC did not collect enough information to assess money laundering risks before opening a client money account for WealthTek. According to the regulator, the bank did not check the Financial Services Register, which would have shown that WealthTek was not authorised to hold client money.
As a result, clients deposited £34 million into the account, increasing the risk of misappropriation or money laundering. Barclays will make a voluntary payment of £6.3 million to WealthTek clients who have not recovered their funds.
In December 2024, the FCA charged WealthTek’s principal partner with several criminal offences, including money laundering and fraud.
Barclays Bank PLC was fined £39.3 million – the bulk of the penalty – for failing to manage money laundering risks when providing services to Stunt & Co. The regulator said the bank did not gather sufficient information at the start of the relationship or carry out effective ongoing monitoring.
Over a year, Stunt & Co received £46.8 million from Fowler Oldfield, a business involved in large-scale money laundering. Barclays did not fully consider the risks even after being alerted by law enforcement and learning of police raids on both firms. The bank only reviewed its exposure after the FCA decided to prosecute NatWest over its dealings with Fowler Oldfield.
“The consequences of poor financial crime controls are very real – they allow criminals to launder the proceeds of their crimes, and they allow fraudsters to defraud consumers,” said Therese Chambers, joint executive director of enforcement and market oversight at the Financial Conduct Authority. “Banks need to take responsibility and act promptly, particularly when obvious risks are brought to their attention.
“In the first of these cases, Barclays secured a significant reduction in its fine through its extensive cooperation with our investigation and through making a voluntary payment to affected consumers at our request.”
Barclays said it is continuing to invest in a remediation programme to strengthen its anti-money laundering controls.
The FCA has identified financial crime as a key focus for retail banks in its 2024 supervisory strategy and continues to supervise firms to ensure they have effective systems to manage these risks.
In November last year, the regulator also fined Barclays £40 million for failing to disclose certain arrangements with Qatari entities during its 2008 capital raising.
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