FCA fines AI Rayan Bank £4m for AML failings


The UK’s Financial Conduct Authority (FCA) has fined another financial institution for anti-money laundering (AML) failings.

The regulator issued a £4m fine to AI Rayan Bank for failing to implement adequate AML controls.

It stated that between 1 April 2015 and 30 November 2017, AI Rayan allowed money to pass through the bank and be used within the UK without carrying out appropriate checks. The firm also failed to adequately check its customers’ source of wealth and source of funds when it was required to ensure money was not connected to financial crime, it said.

Additionally, staff were not provided with proper training about how to handle large deposits, which further heightened the risk of money laundering and financial crime.

The FCA added that AI Rayan was aware of the weaknesses but failed to implement effective changes to fix them, despite the FCA raising concerns about the inadequacies.

Following a visit from the FCA in 2017, the bank voluntarily agreed not to take on further high-risk customers. This restriction has been lifted, following improvements to the bank’s systems and controls. However, the bank is still subject to some limited restrictions while more improvements are made.

AI Rayan did not dispute the FCA’s findings and agreed to settle, which earned it a 30% discount. Without the discount, the fine would have totalled £5.7m.

FCA executive director of enforcement and market oversight Mark Steward said, “Al Rayan failed to manage the risk that it might be used to facilitate money-laundering.  These failings create the conditions in which financial crime is facilitated and can take root within a firm. While the risk was caught in time, the failings here were egregious.   

“The FCA will continue to raise the stakes for firms that do not take their financial crime responsibilities seriously, especially in preventing money laundering risks which harms confidence and integrity in our market and in preventing financial crime, which is a key component in the FCA’s three-year strategy.”

This is the second AML-related fine issued by the FCA this week. It also fined Guaranty Trust Bank £7.8m serious deficiencies in its AML systems and controls.

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