Sanctions

RBS’s Expensive Failure – A £5.6m Case Study

By June 17, 2014 No Comments

RBS’s expensive failure to adequately screen its clients

In what has become a screaming warning for businesses and organizations globally, Royal Bank of Scotland (RBS) was fined £5.6m in 2010 for failing to implement adequate systems and controls to prevent breaches of UK sanctions during the 2007-2008 period.

According to the FSA’s report, this led to the firm taking “unacceptable risk”, potentially at the entire financial ecosystem’s expense. Specifically, RBS’s failures were related to:

  • Inadequate screening of customers
  • Failure to screen transactions
  • Failure to report transactions correctly
  • No regular review of screening filters to ensure they were applied correctly

Following the FSA’s investigation – in which RBS fully cooperated with the authorities – RBS has implemented several measures to ensure their systems and controls don’t put the bank and the financial system at risk.

Image from: theguardian.com

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