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NatWest Fined $286 Billion For Functionally Vital Role In Money Laundering

It is almost normal to see a big bank fined over failing to adhere to regulations. NatWest will have to pay over $265 million for three offenses regarding money laundering. It remains uncanny how banks can get away with this behavior time and time again. 

NatWest Gets Off With A Fine

One can argue the fine NatWest has to pay is rather steep. Spending $265 billion is no chump change, even though a financial institution is less likely to suffer from it. The fine is the result of the bank failing to comply with money laundering regulations on three counts. Failing to comply once is already bad enough, but doing so three times is rather problematic.

Moreover, the bank’s role in the money laundering incident is “functionally vital”. Its inherent failures allowed the money to be laundered, yet had they comp;ied with regulations, that would not have been possible. However, it is crucial to note NatWest played no complicit role in the process. Even so, the judge presiding over the case confirms the bank is not entirely innocent either due to its flagrant shortcomings. 

Interestingly, NatWest and its representatives pleaded guilty to three counts of money laundering. However, that is not the only precedent, as it was also the first time the FCA pursued criminal charges for failure to comply with money laundering regulations. Sadly, it seems unlikely it will be the last time this happens either. Banks have struggled to comply with basic regulations for decades and show no signs of improvement.

The charges include NatWest failing to monitor a commercial customer’s activity properly. Folwer Oldfield, a jewelry business, seemingly let NatWest believe it would not handle cash from the business. In reality, nearly $400 million was deposited with the bank, most of which occurred in cash. Employees handling these cash deposits reported suspicions, yet no action was ever taken. 

A List of Shortcomings

While the staff at NatWest was rather alert, the higher-ups couldn’t care less. The vast sums of cash weren’t enough, but large amounts of Scottish banknotes also moved through English accounts. Additionally, numerous deposits had a musty smell or came through the hands of twitchy individuals. 

Making matters worse is how the system recognized numerous cash deposits as cheque deposits. How that is even possible remains a mystery. Moreover, cheques carry lower money laundering risks, allowing the money to slip through the cracks. A gross failure to comply and properly implement crucial guidelines.

Overall, 11 people pleaded guilty to charges regarding cash deposits, and three cash couriers have been charged. Over a dozen other individuals currently await trial regarding their involvement in Fowler Oldfield’s monetary transactions. NatWest has facilitated money laundering for years without doing anything about it, despite receiving numerous reports and complaints.