Home » UK Business News » Starling Bank Fined Nearly £30m For “Shockingly Lax” Crime Controls

Starling Bank Fined Nearly £30m For “Shockingly Lax” Crime Controls

By Hugh Fort in UK Business News, posted October 2, 2024

Starling Bank has been fined more than £28 million for financial crime failings.

The fine comes from the Financial Conduct Authority (FCA) and is a total of £28,959,426.

The bank has grown from around 43,000 customers in 2017 to 3.6 million in 2023. However, its security around financial crime has not kept pace with its growth.

Serious concerns over systems

In 2021, the FCA found serious concerns over the anti-money laundering and sanctions framework in place at Starling.

The bank agreed to a requirement restricting it from opening new accounts for high-risk customers until this improved.

Starling failed to comply with this and opened more than 54,000 accounts for 49,000 customers deemed to be high-risk.

Then, in January 2023, Starling became aware its automated screening system had only been screening customers against a fraction of the full list of those subject to financial sanctions. This had been happening since 2017.

An internal review identified systemic issues in its financial sanctions framework. Starling has since reported multiple potential breaches of financial sanctions to the relevant authorities.

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FCA Comment and Starling's response

Therese Chambers, Joint Executive Director of Enforcement and Market Oversight, said:

"Starling’s financial sanction screening controls were shockingly lax. It left the financial system wide open to criminals and those subject to sanctions. It compounded this by failing to properly comply with FCA requirements it had agreed to, which were put in place to lower the risk of Starling facilitating financial crime."

David Sproul, chairman of Starling Bank, said: “I would like to apologise for the failings outlined by the FCA and to provide reassurance that we have invested heavily to put things right, including strengthening our board governance and capabilities.

“We want to assure our customers and employees that these are historic issues. We have learned the lessons of this investigation and are confident that these changes and the strength of our franchise put us in a strong position to continue executing our strategy of safe, sustainable growth, supported by a robust risk management and control framework.”

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