FCA has fined Canara Bank £896,100 for failings in its AML systems, and has restricted it from accepting deposits from new customers for 147 days. FCA found that, for a period of over 3 years, the banks failed to maintain adequate systems and did not take sufficient steps to remedy weaknesses that it had been made aware of.
The then FSA had visited the bank as part of its trade finance thematic project in late 2012-early 2013. It notified the bank of a number of systems and controls weaknesses. Canara confirmed it had taken remedial action. A further follow up visit from FCA in 2015 as part of its pro-active AML programme showed that actions taken following the previous visit had not been sufficient and that the bank had not tested the implementation and effectiveness of the steps it took. Other failings it noted was a lack of training for staff since 2012. Further, FCA picked up further failings in the sanctions and AML systems and controls including failure to embed a culture of regulatory compliance. As a result of this visit, and of deficiencies highlighted in the bank’s SYSC compliance report and attestation, PRA appointed a skilled person, whose review highlighted several significant deficiencies, including an inability to recognise PEPs, lack of monitoring and a governance and risk management framework that was not fit for purpose.
FCA found failing at almost all levels of the bank’s business structure, including senior management, governance and oversight, three lines of defence, the reporting function and systems and controls.
Canara had a 30% discount as a result of co-operating fully in the FCA process and settling at an early stage.