NatWest being investigated over money laundering claims - as Financial Conduct Authority launches criminal proceedings

Criminal proceedings have been launched against bank NatWest by the Financial Conduct Authority (Photo: Shutterstock)

Criminal proceedings have been launched against bank NatWest by the Financial Conduct Authority (FCA), after it has allegedly failed to comply with rules regarding money laundering.

The FCA has alleged NatWest of making “increasingly large cash deposits” into a customer’s account, between 2011 and 2016.

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NatWest Group takes extremely seriously its responsibility to seek to prevent money laundering’

The regulator first alerted NatWest Group - which was formerly the Royal Bank of Scotland - of the investigation in July 2017.

The FCA alleges that £365 million was paid into the account between 11 November 2011 and 19 October 2016, of which £264 million was in cash.

In a statement, the FCA said: "The case arises from the handling of funds deposited into accounts operated by a UK incorporated customer of NatWest.

"The FCA alleges that increasingly large cash deposits were made into the customer's accounts.

"It is alleged that around £365m was paid into the customer's accounts, of which around £264m was in cash.

The FCA has claimed that “NatWest's systems and controls failed to adequately monitor and scrutinise this activity."

NatWest - which is 62 per cent owned by the Government - is due to appear at Westminster Magistrates’ Court on April 14, but no individuals are being charged as part of the proceedings.

The launch of these criminal proceedings marks the first time that the FCA has launched a criminal prosecution under 2007 money laundering regulations, and it’s also the first time a bank has faced any prosecution under the rules.

The FCA said the money laundering rules require firms to “determine, conduct and demonstrate risk sensitive due diligence and ongoing monitoring of its relationships with its customers for the purposes of preventing money laundering”.

NatWest said it had been co-operating with the FCA’s investigation to date, and that it takes its responsibility regarding the prevention of money laundering seriously.

The bank said: “NatWest Group takes extremely seriously its responsibility to seek to prevent money laundering by third parties and accordingly has made significant, multi-year investments in its financial crime systems and controls.”