NatWest faces a fine of up to £ 340million after admitting three counts of failing to properly monitor £ 365million deposited into a Bradford jeweler’s account.
This is the first time that a financial institution has been the subject of criminal proceedings under UK anti-money laundering laws.
The Financial Conduct Authority (FCA) said NatWest, 55% taxpayer-owned after more than £ 45bn bailout during the financial crisis, failed to meet the requirements of anti-money laundering legislation regarding Fowler Oldfield’s account between November 7. 2013 and 23 June 2016.
Fowler Oldfield was a century-old jeweler who was shut down after a police raid in 2016. The company has been described as the center of a multi-million pound money laundering business, according to court proceedings that followed. .
FCA prosecutor Clare Montgomery QC told Westminster court that when Fowler Oldfield was hired as a client by NatWest his expected turnover was £ 15million per year. However, he deposited £ 365million in just under five years.
She said: ‘Fowler Oldfield’s turnover was estimated at £ 15million per year. It was agreed that the bank would not process cash deposits. However, he deposited £ 365million, of which around £ 264million was in cash. “
She said that in his heyday, Fowler Oldfield deposited as much as £ 1.8million a day.
NatWest has admitted three offenses under the Money Laundering Regulations 2007. The criminal action, announced by the FCA in March, is the first against a bank under the legislation.
NatWest will be sentenced in Southwark Crown Court no later than December 8.
The FCA has said it will not take action against current or former employees.
The bank said it did not foresee any other authority investigating the conduct.
NatWest Managing Director Alison Rose said: “We deeply regret that NatWest failed to adequately monitor and therefore prevent money laundering by one of our clients between 2012 and 2016.
“NatWest has a vital role to play in the detection and prevention of financial crime and we take our responsibility to prevent third party money laundering very seriously. In the years since this case, we have invested significant resources and continue to intensify our efforts to effectively combat financial crime.
“We are working tirelessly with colleagues, other banks, industry bodies, law enforcement, regulators and governments to help find collaborative solutions to this common challenge. These partnerships are essential in addressing the significant and evolving threat of financial crime to society. “