In March 2015, after fining the Bank of Beirut’s UK arm £2.1m ($3.3m) and issuing joint fines of more than £30,000 to a compliance officer and an internal auditor, the UK Financial Conduct Authority (FCA) introduced a number of innovations relating to how it will levy penalties. The penalty amounts in the Bank of Beirut case are substantial for the FCA, but it is significant that two individuals were blamed and that restrictions were imposed on one of the bank’s lines of business.
The level of the penalty imposed and the FCA's singling out of personnel is similar to the approach taken by US regulators recently. This potentially signals a new tougher attitude about anti-money laundering (AML) enforcement in the UK. There are some other interesting features of this case. During the investigations it has been reported that, over a six-month period, Bank of Beirut wrote five inaccurate memos to the FCA, an extremely serious action. So, given the evidence that such misleading information was given, the financial penalty does appear rather low. However, the bank’s UK operation is also relatively small, with just £321m in assets.
