Natwest fined £265m for laundering drug gang cash
What’s going on?
Natwest has been fined £265m by the financial regulator after the high street bank pleaded guilty to failing to stop money laundering by suspected criminal gangs.
Why is this important?
By law all financial firms have to follow strict rules to ensure they don’t help criminals turn their ill-gotten gains into legitimate funds.
Natwest failed to spot some blatant red flags of this sort of activity for years with a string of customers.
A court heard that a Bradford jeweller, that was suspected as a front for a drug gang, deposited over £200m in cash at 50 branches during a period of five years. That's despite having less than £20m in revenue.
Cash would arrive in black bin bags with branch managers running out of room to store it in safes but no alarm was raised. It was only after a police raid that the jeweller was shutdown.
Natwest is still 55% owned by the state following its taxpayer bailout during the financial crisis. So facilitating money laundering is doubly embarrassing for the government.
The bank said it “deeply regretted” its failures. It has invested £700m in preventing financial crime and has another £1bn planned until 2026.