Barclays Fined £42 Million for Major Money Laundering Failures

FCA Uncovers Critical Oversight Lapses

The UK Financial Conduct Authority (FCA) has imposed a £42 million penalty on Barclays Bank for severe anti-money laundering (AML) control failures. The regulator identified two glaring cases where Barclays neglected basic due diligence, exposing the bank to criminal activity and putting customer funds at risk.

Case 1: Gold Bullion Firm Red Flags Ignored

Barclays received its largest fine (£39.3 million) for mishandling the Stunt & Co account, a gold bullion trader. Between 2018-2019, the bank processed £46.8 million in suspicious transactions from Fowler Oldfield – a jewelry firm already under police investigation for money laundering.

Key failures included:

  • Continuing transactions after law enforcement notified Barclays about the police raids

  • Failing to conduct enhanced due diligence

  • Ignoring obvious red flags about the source of funds

Case 2: Unauthorized Wealth Management Account

In a separate incident, Barclays opened accounts for WealthTek LLP without verifying its regulatory status. A simple Financial Services Register check would have revealed:

  • WealthTek lacked authorization to hold client money

  • The firm’s principal had undisclosed criminal investigations

  • £34 million in client deposits were ultimately compromised

Barclays has agreed to repay £6.3 million to affected customers following WealthTek’s collapse.

Regulatory Crackdown Intensifies

FCA Executive Director Therese Chambers stated: “When we highlight risks, banks must respond immediately. Poor financial crime controls have real consequences.” The enforcement action comes as:

  • UK authorities ramp up AML enforcement

  • WealthTek’s principal faces fraud charges

  • Banks face growing pressure to strengthen compliance

Industry-Wide Implications

This penalty sends clear messages to financial institutions:

  1. Transaction monitoring systems require constant review

  2. Law enforcement alerts demand immediate action

  3. Basic regulatory checks remain essential

  4. Consequences for failures are escalating

Barclays has committed to overhauling its financial crime controls, but the damage to its compliance reputation may linger. The case establishes a new benchmark for AML enforcement severity in the UK banking sector.

Search for Blogs/Event/News