THE taxpayer-owned Royal Bank of Scotland group have pled guilty to charges of failing comply with money laundering regulations.
The Edinburgh-based group now known as NatWest has expressed “deep regret” after it admitted failing to adhere to regulations between November 2012 and June 2016 in relation to an unidentified “UK incorporated customer”.
It is the first criminal prosecution under the money laundering regulations 2007 by the FCA, and the first prosecution under the regulations against a bank, The NatWest group said that the regulations required the firm to determine and conduct risk sensitive ongoing monitoring of its customers for the purposes of preventing money laundering.
“The offences relate to operational weaknesses between 2012 and 2016 which meant that NatWest did not adequately monitor the accounts of that customer,” it said.
The state-backed NatWest group, had been accused by the Financial Conduct Authority (FCA) of paying around £365m into the customer’s accounts, of which around £264m was in cash.
The FCA said in a statement in March: “The case arises from the handling of funds deposited into accounts operated by a UK incorporated customer of NatWest.
“The FCA alleges that increasingly large cash deposits were made into the customer’s accounts.”
NatWest group chief executive Alison 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.
“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.”
The group said it had “co-operated fully” with the FCA since its investigation began. It said that the FCA has confirmed it will not take action against any individual current or former employee of NatWest.
It said that in pleading guilty, NatWest “acknowledges relevant operational failures” this included “weaknesses in some of the bank’s automated systems as well as certain shortcomings in adherence to monitoring and investigations procedures”.
It said it was not aware of, and is not anticipating, any other authority investigating its conduct in this matter.
The case has been remitted to the Crown Court in England for sentencing which will be determined at a subsequent hearing, expected to be in four to eight weeks’ time.
It said a provision will be made in the group’s third quarter of 2021 financial accounts in anticipation of a potential fine being imposed at that hearing.