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AML system failings sees Canara Bank fined by the FCA


6th June 2018

The FCA has today fined Canara Bank almost £900,000 and restricted the Bank from accepting deposits from new customers for over 4 months.

It transpires that for a period between November 2012 and January 2016 the Bank failed to maintain adequate anti-money laundering systems and also failed to take sufficient measures to address weaknesses that had been identified within its AML systems and controls, despite having been notified of these.

The Executive Director of Enforcement and Market Oversight at the FCA, Mark Steward commented on the Bank’s failings saying:

“Canara was warned its money laundering controls were inadequate and so its failure to remediate them properly is at the more serious end of the range of sanctions.”

The Final Notice issued to Canara Bank today highlighted how important it is for branches of overseas banks – as well as their senior management - to have sufficient understanding of their regulatory responsibilities as well as making sure that their obligations are addressed by sufficient and appropriate resources.

The FCA acknowledges that senior management at Canara have fully co-operated and engaged with the FCA’s investigation and that the firm’s substantive AML deficiencies now have been rectified.

The regulator is continually emphasizing the importance of having a robust AML control framework and firms are frequently reminded of how to comply with AML requirements and of the importance of safeguarding the UK financial system from financial crime.

Had Canara Bank not agreed to settle at an early stage of the FCA’s investigation the financial penalty would have been £1,280,175.

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Comment from the FCA:

“Financial crime and money–laundering failures are areas of focussed priority for us. Canara was warned its money laundering controls were inadequate and so its failure to remediate them properly is at the more serious end of the range of sanctions.”

Mark Steward, FCA  Enforcement& Market Oversight June 2018