- Chief Compliance Officer and VP of Legal Affairs, Arrow Electronics
By 
Aaron Nicodemus2024-10-02T18:22:00
Britain’s first digital bank grew exponentially fast in five years, with 43,000 customers ballooning to more than 3.6 million by 2023. Starling Bank’s financial crime program, however, did not keep pace with its growth, according to the U.K.’s Financial Conduct Authority (FCA). In 2021, the regulator found serious deficiencies in the bank’s financial crime prevention system and ordered it to stop onboarding high-risk customers until improvements were made.
But Starling failed to comply with that order, opening 54,000 accounts for 49,000 customers at high risk of having financial sanctions from 2021-23. Over the same period, Starling reported multiple breaches of financial sanctions to the relevant authorities.
As a result of repeatedly failing to comply with its 2021 order, the FCA announced Wednesday that it fined Starling 29 million pounds (U.S. $38.5 million). The regulator noted that the investigation into the issues at Starling took 14 months to complete—significantly faster than the agency’s 42-month average the last two years.
THIS IS MEMBERS-ONLY CONTENT. To continue reading, choose one of the options below.
News and analysis for the well-informed compliance or audit exec. Select an option and click continue.
Annual Membership $499 Value offer
Full price one year membership with auto-renewal.
Membership $599
One-year only, no auto-renewal.
The U.K. will struggle to shed its reputation as one of the world’s biggest conduits for dirty money due to a combination of patchy intelligence-sharing and poorly resourced enforcement agencies, experts told Compliance Week.
The U.K. Financial Conduct Authority has fined Metro Bank 16.6 million pounds (U.S. $21 million) for an alleged failure by its automated system to adequately monitor money laundering risks.
TSB Bank has been fined 10.9 million pounds (U.S. $14.2 million) for treating retail customers poorly while they were in arrears on mortgages, credit cards, loans, and overdraft accounts, the Financial Conduct Authority said.
USAA Federal Savings Bank has been hit with its third cease and desist order from the Treasury Department’s Office of the Comptroller of the Currency in the past five years for failing to correct unsafe and unsound banking practices.
Becton Dickinson medical device company will pay $175 million for “repeatedly” misleading investors about its Alaris infusion pump, a product the company knew was flawed and was sold without the required patient-safety approvals, the Securities and Exchange Commission said.
The Securities and Exchange Commission charged bankrupt fashion retailer Express with failing to disclose nearly $1 million in perks to a former chief executive, but did not levy a financial penalty thanks to its cooperation, the SEC said.
