AML fines ‘hit $2.2bn’ in 2020

Fines related to anti-money laundering (AML) failures hit $2.2 billion globally in 2020 according to research from consulting firm Kroll.

The total value of fines for 2020 was five times that of 2019, but the number of AML fines given out to regulated institutions remained the same at 45.

2021 is also proving to be a significant year in terms of AML fines, with $994 million worth of them issued as of June 2021 according to the New York-based firm, nearly half of the 2020 and 2017 totals.

Kroll said the Nordics and Australia have “led the way” and imposed record levels of enforcement penalties, despite the US historically leading the way in terms of issuing AML fines.

$47 million worth of AML fines were issued in the UK in 2020, far less than the $404 million worth of fines issued in the US, the $917 million issued in Australia, the $560 million issued in Sweden, and the $357 million issued in Hong Kong.

Kroll said that AML management, suspicious activity monitoring, customer due diligence, and compliance oversight were the most frequently cited failings in its report, and that this trend is consistent across all regions globally.

The findings come after the Financial Conduct Authority (FCA) revealed earlier this week that NatWest has been fined £264.8 million following convictions for three offences of failing to comply with money laundering regulations.

“The figures show that investigations were not paused for Covid-19,” said Claire Simm, managing director, financial services compliance and regulation at Kroll. “While the number of fines remained constant, the value of fines surged as regulators imposed tougher penalties, continuing to send the message that despite any obstacles, enforcement remains a top priority for non-compliant behaviour.

“These fines show that across the world, regulators continue to put high importance on financial crime enforcement.”

She added: “We can expect to see mega-fines and criminal enforcement continue through 2021 and beyond."

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