According to a UK financial regulator, the guilty plea is the first criminal trial under money-laundering rules that took effect in 2007.
The criminal charges brought by the FCA stemmed from operational vulnerabilities in UK Bank’s anti-money-laundering protections between 2012 and 2016, which caused it to fail to adequately monitor the accounts of an unnamed UK Incorporated customer, NatWest said.
The FCA said on Thursday that the case had been sent to London’s Southwark Crown Court for sentencing. NatWest said sentencing is expected in four to eight weeks, and it will make provisions in the company’s third-quarter financial statements in anticipation of the imposition of a potential fine. The statements are due to be published on October 29.
NatWest said it has cooperated fully with the FCA since the beginning of the investigation.
“We deeply regret that NatWest failed to adequately monitor and therefore prevent money laundering by one of our customers between 2012 and 2016. NatWest has an important role in detecting and preventing financial crime. And we take very seriously our responsibility to prevent money laundering from third parties,” said Alison Rose, chief executive of NatWest.
The FCA said on Thursday that no person would be charged as part of the proceedings against the bank.
According to S&P Global Ratings, based on statements made in court, NatWest is likely to be fined between £174 million and £348 million (ranging from approximately $237 million to $474 million in US dollars). The credit rating firm said it expects NatWest’s franchise and daily business activities will not be affected by the fine.
S&P said the case highlights challenges in implementing robust prevention and detection procedures by large banks, and verifying that these controls are effectively deployed across the institution.
According to the bank, NatWest has spent around £700 million to strengthen its financial crime control system over the past five years, and plans to invest another £1 billion over the next five years.
Dylan Tokar at [email protected]