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UK fines Standard Bank $12.6 million

January 23, 2014

LONDON (AP) — British authorities fined a South Africa-based bank 7.6 million pounds ($12.6 million) Thursday for failing to carry out adequate safeguards to combat money laundering.

The Financial Conduct Authority fined Standard Bank, the U.K. subsidiary of Standard Bank Group, for shortcomings in its procedures regarding corporate customers with political ties. The group has extensive operations in 18 African countries and operations in 13 other countries outside of Africa.

“Banks are in the front line in the fight against money laundering,” said Tracey McDermott, the FCA’s director of enforcement and financial crime. “If they accept business from high risk customers they must have effective systems, controls and practices in place to manage that risk. Standard Bank clearly failed in this respect.”

The case is the first anti-money laundering case brought by the FCA or its predecessor agency that focused on commercial banking activity.

The authority noted that the bank co-operated and settled at an early stage of the investigation, qualifying for a 30 percent discount on its fine.

The bank issued a statement noting that the investigation focused on a sample of historical client files and that it has embarked on an extensive remediation plan.

“The FCA made no finding that the bank had ever handled the proceeds of crime,” the bank said.