Barclays Fined for Failing to Minimize Financial Crime Risk

LONDON—The Financial Conduct Authority said Thursday it has fined U.K. bank Barclays PLC £ 72.07 million ($108.89 million) for failing to minimize the risk against financial crime, its largest ever fine for such failings, but stopped short of saying if a crime had been committed.

The U.K. regulator said the failings relate to a £ 1.88 billion transaction that Barclays arranged and executed in 2011 and 2012 for a number of ultra-high-net-worth clients. The clients involved were politically exposed persons and should therefore have been subject to enhanced levels of due diligence and monitoring by Barclays, the regulator said.

"Barclays ignored its own process designed to safeguard against the risk of financial crime and overlooked obvious red flags to win new business and generate significant revenue. This is wholly unacceptable," said Mark Steward, director of enforcement and market oversight at the FCA.

"Firms will be held to account if they fail to minimize financial crime risks appropriately and for this reason the FCA has required Barclays to disgorge its revenue from the transaction," Mr. Steward said.

The fine comprises £ 52.3 million representing the amount of revenue Barclays generated from the transaction, and a penalty of £ 19.77 million, the FCA said.

Barclays agreed to settle the fine quickly and therefore received a 30% discount.

Write to Ian Walker at [e-mail]

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November 26, 2015 05:05 ET (10:05 GMT)

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