Lessons from NatWest/Santander and Barclays Failure to comply with money laundering regulations

NatWest 2021

1. In December 2021, National Westminster Bank plc (NatWest) pleaded guilty to offences under the UK Money Laundering Regulations 2007 (MLR 2017).
1. Now superseded by the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017).
2. It was the first prosecution of its kind of a bank for failure to comply with money laundering regulations.
1. Regina (Financial Conduct Authority) v. National Westminster Bank PLC
3. Although the court accepted it that the ‘overarching design of the Bank’s ongoing monitoring systems, and the policies and procedures in relation to ongoing monitoring, were in line with industry guidance’, there were two key aspects to the compliance failures that resulted in the convictions: the Sentencing remarks of Mrs Justice Cockerill, 13 December 2021, in particular para. 15 focused on
1. ‘The Group’s policies and procedures DID NOT ADDRESS the need for staff to guard against overreliance being placed on relationship managers when considering suspicious activity on a customer account.’^[55]
2. The group’s policy stated that a particular form of monitoring was only required “where the capability to do so exists”. This would not in itself fulfil guidance issued by the Joint Money Laundering Steering Group that required firms to monitor transactions to ensure they were consistent with their risk profile.’^[1]

Santander 2022

1. In December 2022, Santander was fined £107.7 million for anti-money laundering (AML) failures pursuant to Section 206 of the Financial Services and Markets Act 2000.
2. Santander had ineffective systems for verifying the information customers provided about the businesses they intended to do business with.
3. The firm also failed to monitor the funds that customers had told it would be deposited into their accounts, compared with the amounts actually deposited.^[2]
4. In particular, the Final Notice identified failures of governance in respect of AML risk due to operational siloes and a priority of systems operations over qualitative assessments. It stated:
1. Santander UK’s processes did not provide for the effective ownership of the money laundering risk presented by its Business Banking portfolio.
2. Various AML functions were divided between different teams, which operated in siloes and did not share information sufficiently.
3. Some functions operated a centralised operational model which prioritised the completion of processes above qualitative assessments.
4. As a result, its governance processes failed to ensure that its systems managed AML risks within Business Banking appropriately. [2]

Barclays July 2025

• In July 2025, Barclays Bank UK PLC and Barclays Bank PLC were fined a total of £42 million for separate instances of failings in their financial crime risk management.
• In the first case, Barclays Bank UK PLC failed to check that it had gathered sufficient information to understand the money laundering risk before opening a client money account.
• In the second case, the FCA fined Barclays Bank PLC £39.3 million for failing to adequately manage money laundering risks associated with providing banking services to a firm.
• Barclays did not gather enough information at the start of the relationship or carry out proper ongoing monitoring.
• Barclays failed to properly consider the money laundering risks associated with the firm, even after receiving information from law enforcement about suspected money laundering and after learning that the police had raided both firms.^[3]

Conclusion

The overreliance of any compliance system on a single individual and the failure to adhere to published guidance are valuable lessons to be reminded of in respect of any compliance process, whether in the context of specific criminal offences applying to the regulated sector in relation to money laundering, or more widely.

In the case of NatWest, these failings had serious consequences, including more than £250 million of laundered cash being deposited in four years. After a one-third deduction in penalty for guilty pleas, NatWest was fined roughly £265 million.

Source

^[1] National Westminster Bank, para. 15(b) (emphasis in original).

^[2] FCA Press Release titled ‘FCA fines Santander UK £107.7 million for repeated anti-money laundering failures’, 9 December 2022, https://www.fca.org.uk/news/press-releases/fca-fines-santander-uk-repeated-anti-money-laundering-failures (accessed July 2025).

^[3] https://www.fca.org.uk/publication/final-notices/santander-uk-plc-2022.pdf at Para

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