Banking giant Barclays has been handed a £3m fine and has agreed to make other voluntary payments over its work with the closed North East wealth management firm WealthTek.
The Financial Conduct Authority (FCA) has fined Barclays more than £42m over its “poor handling” of financial crime risks in separate cases linked to the WealthTek and Stunt & Co businesses.
WealthTek, which also traded as Vertem Asset Management and Malloch Melville, was closed down by the FCA in 2023 after the watchdog said “serious regulatory and operational issues” had come to light. The FCA later said there was a potential £81m shortfall in client money and has charged principal partner John Dance with nine charges including fraud by abuse of position, fraud by false misrepresentation and money laundering. Mr Dance has pleaded not guilty to the charges.
Barclays Bank Ƶ has been fined £3.1mn after it failed to check it had enough information to understand the money laundering risk before opening a client money account for WealthTek, the FCA said. It added that Barclays had also agreed to make voluntary payment of £6.3m to WealthTek’s clients who have a shortfall in the money they have been able to reclaim.
The FCA said that, in the WealthTek case, Barclays had received a “significant reduction” in its fine for co-operating in the investigation.
Separately, Barclays has been fined £39.3m for “failing to adequately manage money laundering risks” related to providing banking services to Stunt & Co, the firm run by socialite James Stunt. Mr Stunt, the director and owner of Stunt & Co, was acquitted of money laundering charges.
Therese Chambers, joint executive director of enforcement and market oversight at the Financial Conduct Authority (FCA), said: “The consequences of poor financial crime controls are very real – they allow criminals to launder the proceeds of their crimes, and they allow fraudsters to defraud consumers. Banks need to take responsibility and act promptly, particularly when obvious risks are brought to their attention.
“In the first of these cases, Barclays secured a significant reduction in its fine through its extensive co-operation with our investigation and through making a voluntary payment to affected consumers at our request.”
In response to its fine from the FCA, a Barclays spokeswoman said: “Barclays remains deeply committed to the fight against financial crime and fraud. The FCA’s investigation relating to Stunt & Co was centred around historical money laundering activity and made no findings that the bank had breached money laundering regulations.
“As acknowledged by the FCA, Barclays undertook an extensive review and self-reported its findings to the FCA. Barclays fully co-operated with both investigations and has further strengthened its financial crime and other control capabilities.”
