May told the court “it was not suggested there has been actual financing of terrorism or money-laundering occurring”. But he said the breaches were serious, because they concerned “the adequacy and effectiveness of the very processes by which an entity such as TSB is required to comply with the act and ensure it is complying”. “To put it another way, if these controls aren’t in place or aren’t operating effectively, then it could not have known if financing of terrorism or money-laundering was occurring.” TSB lacked adequate procedures, processes and controls, failed to review its AML programme, and did not conduct a risk assessment of its real estate business as it was supposed to do, he said.