During a review of money laundering risk at EFG in January 2011, the Financial Services Authority (FSA) found that the lender was not fully translating its AML policies into practices.
Inspection of around 36 files opened between December 2007 and January 2011, highlighted that 17 customer files were at higher money laundering risks, but the bank did little to mitigate such risks.
Out of these 17 files, 13 files were related to criminal activity, in which the customer had been sued for criminal offences including corruption and money laundering.
Out of a total 99 PEP and other high risk customer files inspected by the FSA, 83 raised serious concerns about EFG’s monitoring of the relationship and failure to properly screen its higher risk accounts.
FCA enforcement and financial crime head Tracey McDermott said that the companies which accept business from high risk customers must have systems, controls and practices to manage the same.
The regulatory agency said that EFG, the UK private banking subsidiary of the Swiss EFGI Group, settled the matter at an early stage and availed a 30% discount, otherwise the fine would have been £6m.
