RBS Under FCA Investigation over Money Laundering Scheme

The Guardian reported earlier this year on a Russian money laundering scheme dubbed 'the Laundromat'.

The Financial Conduct Authority (FCA) is investigating the role of Royal Bank of Scotland (RBS) over the alleged processing of hundreds of millions of pounds for a Russian money laundering scheme, the lender said today in an official statement.

“On 21 July 2017 the FCA notified RBS that it is undertaking an investigation into RBS PLC’s compliance with the Money Laundering Regulations 2007 in relation to certain customers. RBS is cooperating with the investigation,” the bank disclosed Friday.

Join the iFX EXPO Asia and discover your gateway to the Asian Markets

RBS noted in its announcement that the case involves a number of established companies in the UK and the US and that authorities will investigate the alleged involvement of British banks in the passing of huge sums of laundered Russian money through their systems.

“Allegedly certain European banks, including RBS and 16 other U.K.-based financial institutions and certain U.S. banks, were involved in processing certain transactions associated with this scheme. In common with other banks RBS is responding to requests for information from the FCA, Prudential Regulation Authority and regulators in other jurisdictions,” RBS said.

Suggested articles

Ready to kick-off your Trading Game with Manchester United?Go to article >>

The FCA, tasked with ensuring that financial services firm have adequate AML policies in place, will investigate closely the latest revelations by the Guardian newspaper regarding money laundering from Russia.

The British newspaper reported earlier this year on a Russian money laundering scheme dubbed ‘the Laundromat’ which involved several thousands of banking transactions totalling at least $22 billion. The scheme, which ran from 2010 to 2014, was designed to benefit Russians seeking to move money out of the country, according to the Guardian.

Meanwhile, RBS revealed its Brexit contingency plans, which came in tandem with an optimistic earnings report that saw its income jump in Q2 2017. The bank saw a Q2 profit of £939.0 million, which helped erase a £2.0 billion loss just one year ago.

Earlier last month, the lender agreed to pay $5.5 billion to settle lawsuits filed in US courts by the Federal Housing Finance Agency (FHFA) accusing the bank of mis-selling billions of dollars in mortgage-backed securities before the global financial crisis.

Got a news tip? Let Us Know