The recent and astonishing conviction of NatWest for money laundering brings into sharp focus the measures banks use when they suspect customers of committing a financial crime.
The facts surrounding this case are something out of John Grisham novel. NatWest admitted laundering £365 million for a company of jewellers, Fowler Oldfield, which had a predicted turnover of £15 million. The National Crime Agency was concerned that many Scottish banknotes were being deposited in the account. It transpired that various branches received vast amounts of cash into the account, with the Southall branch alone taking £42 million over a 14 month period.
NatWest pleaded guilty to 3 offences of failing to comply with anti-money laundering regulations. It was ordered to pay a fine of £264,772,620, costs of £4,297,466 and a confiscation order of £460,047 was also imposed.
It is noteworthy that no individuals were prosecuted.
How does this reflect on the way banks deal with customers they suspect of being involved in financial crimes such as money laundering? Banks can load “fraud markers” against various fraud databases such as CIFAS, National Hunter and Synetic Solutions when they have reasonable suspicion that a financial crime has been or is in the process of being committed. Such markers result in accounts being blocked and the customers facing the prospect of being unable to obtain credit or banking facilities for up to 6 years. CIFAS has revealed that hundreds of thousands of such markers are loaded every year.
We will never know what internal action was taken by NatWest against its staff due to this money laundering case. But, it is likely that CIFAS markers will have been loaded against them, meaning that they would not be employable in financial services.
Successfully challenging such markers is technically difficult and involves customers having to prove to their bank that they are innocent of wrongdoing. That can be very difficult when customers are unaware that markers have been loaded against them and evidence is lost over time.
The law used to challenge such decisions is also technical and challenging.
So, if you have had your bank account closed, a mortgage application declined, have had difficulty getting a phone contract or car insurance, you may be affected by this issue, even if you have never committed a financial crime such as money laundering. If so, please contact Jeremy Asher, who will explore whether you have a marker and whether it can be challenged. Depending on the circumstances, some can be, and are, overturned.
Jeremy Asher
Consultant Regulatory Solicitor
T: 01884 210 629 or call 0330 058 4012
ext. 2272
E: jasher@setfords.co.uk