The Financial Conduct Authority (FCA), the financial regulatory body of United Kingdom, has fined Starling Bank of £ 29 Million for alleged failure related to financial sanctions screening including failure to consider high risk factors such as crypto related platforms.
According to a statement issued by FCA on October 2, the bank had opened 54,000 accounts for 49,000 high-risk customers between September 2021 to November 2023. The bank’s sanctions screening review had failed to consider high risk factors such as crypto related platforms.
“Starling’s financial sanction screening controls were shockingly lax. It left the financial system wide open to criminals and those subject to sanctions. It compounded this by failing to properly comply with FCA requirements it had agreed to, which were put in place to lower the risk of Starling facilitating financial crime,” said Therese Chambers, Joint Executive Director of Enforcement and Market Oversight, FCA.
FCA claimed that it had reviewed Starling Bank’s security framework back in 2021 and found serious concerns in the anti-money laundering and sanctions framework. The Starling Bank had then agreed to restricting new accounts for high risk customers until their framework was improved.
“In January 2023, Starling became aware that its automated screening system had, since 2017, only been screening customers against a fraction of the full list of those subject to financial sanctions. A subsequent internal review identified systemic issues in its financial sanctions framework. Starling has since reported multiple potential breaches of financial sanctions to the relevant authorities,” said FCA in a statement.
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