"Metro's failings risked a gap being left in our defence against the criminal misuse of our financial system. Those failings went on for too long."
- Therese Chambers, joint executive director of enforcement and market oversight at the FCA
The FCA has fined Metro Bank £16,675,200 for financial crime failings.
Its investigation found that between June 2016 and December 2020, Metro failed to have the right systems and controls to adequately monitor over 60m transactions, with a value of over £51bn, for money laundering risks.
Metro automated the monitoring of customer transactions for potential financial crime in June 2016. However, its system did not work as intended. An error in how data was fed into the system meant transactions taking place on the same day an account was opened, and any further transactions until the account record was updated, were not monitored.
Junior staff did raise concerns about some transaction data not being monitored in 2017 and 2018, but these did not result in the issue being identified and fixed. Even once a fix had been put in place in July 2019, Metro did not have a mechanism to consistently check that all relevant transactions were being fed into the monitoring system until December 2020, over four and a half years after the system was implemented.
Since the firm’s identification of the issues with its transaction monitoring system in April 2019, Metro Bank has put in place processes to remediate the issues identified.
Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said: "Metro's failings risked a gap being left in our defence against the criminal misuse of our financial system. Those failings went on for too long."
Daniel Frumkin, CEO of Metro Bank, commented: “The conclusion of these enquiries draws a line under this legacy issue, allowing the bank to move forward and fully focus on the future, building on the solid foundations it has already laid. We are continuing, at pace, our shift towards higher yielding specialist mortgages and commercial, corporate and SME lending with a strong pipeline of business.
“In line with the upgraded guidance provided at half year results, we have today also announced a return to underlying profitability in October, reflecting the significant progress made in delivering on the bank’s strategic priorities. Our relationship-led banking model will allow Metro Bank to go from strength to strength as we forge ahead with our growth agenda and progress towards long term sustainable profitability.”
