NatWest Group PLC (LSE:NWG) faces “a very large fine” after the lender admitted three charges in court relating to anti-money laundering failures over multi-million-pound cash deposits made to a single customer’s account.
A case at Westminster Magistrates’ Court was brought against the bank under money laundering regulations from the City watchdog related to GBP359mln of deposits, of which GBP264mln was in cash.
The deposits were made by a bank customer connected with Fowler Oldfield, a Bradford-based jeweller that was shut down following a police raid in 2016.
A lawyer for the Financial Conduct Authority (FCA) told the court that “likely sentence is a very large fine” – estimated to be around GBP340mln – when the hearing takes place in coming months.
NatWest, where the government still has a majority 54.7% stake, pleaded guilty and said it acknowledged “operational failures” made between 2012 and 2016.
In a regulatory news statement, the bank said the case has been remitted to the Crown Court for sentencing at a subsequent hearing, expected in four to eight weeks’ time.
In anticipation of the potential fine, NatWest will make a provision in its third-quarter financial accounts, it added.
“We deeply regret that NatWest failed to adequately monitor and therefore prevent money laundering by one of our customers”, said NatWest chief executive Alison Rose.
“NatWest has a vital part to play in detecting and preventing financial crime and we take extremely seriously our responsibility to prevent money laundering by third parties.”
She said the bank has invested “significant resources” in its efforts to combat financial crime since 2016.
This is the first time the FCA has used its criminal money laundering powers since gaining them in 2007.