Money laundering is gradually becoming a serious financial crime in Europe as well. The UK Financial Conduct Authority (FCA) fined Gatehouse Bank £1.5 million for its relaxed money-laundering checks. Gatehouse (website) failed to conduct sufficient checks on its customers based in countries with a higher risk of money laundering and terrorist financing. Gatehouse also failed to undertake the appropriate checks when some of the customers were classed as Politically Exposed Persons (PEPs).
In one instance, Gatehouse Bank set up an account for a company based in Kuwait to aggregate customer funds. Gatehouse Bank did not require the company to collect information about customers’ sources of funds or wealth, which was required under Gatehouse’s anti-money laundering policies. As a result, over a two-year period, Gatehouse accepted US$62,000,000 into the account without properly vetting the funds for financial crime risks. This example illustrates the risks of failing to have proper systems and controls.
Gatehouse has subsequently taken significant steps to improve its financial crime systems and controls.