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The Financial Conduct Authority’s (FCA’s) inaugural use of its criminal money laundering powers under Regulation 45 of the UK Money Laundering Regulations 2007 (MLR) against NatWest is viewed by many as a warning shot to firms within scope of the MLR that the FCA is prepared to utilise its criminal authority in cases that it considers to be serious, including against major financial institutions.
The FCA has had the ability to exercise its criminal money laundering powers since their introduction to the MLR, however, had not done so until now. This case marks the FCA’s first criminal prosecution for money laundering offences, as well as the first criminal prosecution against a bank for such offences. Previous FCA enforcement action has focussed on monetary penalties in the form of fines for breaches of regulation, therefore, the criminal action taken by the FCA signals a new regulatory approach.