Barclays Fined for Poor Financial Crime Risk Management

The Financial Conduct Authority (FCA) has imposed fines on Barclays totaling £42 million due to two instances of inadequate financial crime risk management, as reported on July 16.

Barclays has not responded to requests for comment regarding this issue.

In the first instance, Barclays opened a client money account for wealth managers known as Weltech. The FCA shut down Weltech in 2023 over serious regulatory and operational problems. John Dance, a former partner at the firm, has faced allegations related to a scam trial set for 2027.

“It was quite straightforward to check the Financial Services Registry before opening an account,” the FCA noted in a press release. It mentioned that if this had been done, it would have been clear that Weltech should not have been allowed to handle client funds through the FCA.

Barclays has been fined £3 million and is also set to pay £6.3 million voluntarily to customers affected by Weltech.

In the second case, Barclays received a £39.3 million fine for not managing money laundering risks while servicing Stunt & Co.

The FCA stated that Barclays failed to adequately assess the money laundering risks associated with Stunt & Co., even after receiving alerts from law enforcement about related issues involving Fowler Oldfield and recognizing that police had investigated both entities.

By cooperating with the investigation and voluntarily repaying affected customers, Barclays managed to secure a notable reduction in fines related to the Weltech case. The bank is currently implementing a “critical repair program” to enhance its anti-money laundering controls.

This penalty comes just a week after the FCA fined Monzo, a UK digital bank, for deficiencies in crime management. Monzo was fined approximately $28.5 million for failing to set up proper customer onboarding, risk assessments, and transaction monitoring between October 2018 and August 2020.