FCA slaps Barclays with £783,800 fine over Premier FX relationship

28th Feb 2022 10:50

(Sharecast News) - The Financial Conduct Authority has slapped Barclays Bank with a £783,800 fine for oversight failings in its relationship with collapsed payments firm Premier FX.

The FCA said on Monday that Barclays had failed to make enquiries to ensure that Premier FX's actual business activity aligned with its expectations and did not identify that Premier FX's internal controls were deficient, which the FCA said constituted a failure by Barclays to conduct its business with due skill, care and diligence.

The industry watchdog stated that the financial penalty took into account the fact that Barclays, Premier FX's sole banker in the UK, had agreed to voluntarily cover the losses of Premier FX customers whose claims had been accepted by the company's liquidators.

Following distribution by the liquidator, amounting to 9.0p for every £1.0 lost, Barclays' voluntary payment of £10.07m will make up the difference, meaning all 167 customers of Premier FX with accepted claims will have 100% of their money returned. The voluntary payment will be distributed to customers by the liquidators by the end of March.

Mark Steward, the FCA's executive director of enforcement and market oversight, said: "Premier FX, which handled money on behalf of other people, presented particularly high risks of financial crime and fraud. Barclays was aware of these high risks in providing banking services to Premier FX but failed to take reasonably appropriate steps to mitigate those risks.

"Barclays' agreement to meet the deficiency in Premier FX's funds mitigates the actual losses to Premier FX's customers. This is a significant step to the credit of the bank and has reduced substantially the sanction that otherwise would have been imposed."

As of 1050 GMT, Barclays shares were down 4.32% at 180.74p.