Royal Bank of Scotland Group has been fined £5.6 million by the UK Financial Services Authority for not checking its customers against a list of people on the UK Treasury's sanctions list.
The FSA said RBS units Ulster Bank, National Westminster Bank, RBS and Coutts and Co didn't adequately screen customers and transactions against an HM Treasury list between December 2007 and December 2008 to prevent breaches.
The bank "left itself open to the risk that it was facilitating terrorist financing", FSA enforcement director Margaret Cole said in the statement. "The scale of the fine shows how seriously the FSA takes this issue and should act as a warning to other firms."
RBS got a 30 per cent discount on the fine for settling the case early in the investigation, the FSA said.
The investigation "confirmed the deficiencies we had identified and brought to their attention in our policies, procedures and controls during the year to December 2008", RBS Head of Restructuring and Risk Nathan Bostock
said in a statement today. "The FSA noted that it did not consider this misconduct deliberate or reckless."
Bloomberg