FCA issues Final Notice to former CEO for anti-money laundering failings

Mr. Prodhan was the senior manager at SBUK with responsibility for the establishment and maintenance of effective AML systems and controls.

Between 7 June 2012 and 4 March 2014, Mr. Prodhan failed to take reasonable steps to assess and mitigate the AML risks arising from a culture of non-compliance among SBUK’s staff. He failed to ensure that there was a clear allocation of responsibilities to oversee SBUK’s branches, and he also failed to properly oversee, manage, and resource SBUK’s Money Laundering Reporting Officer (MLRO) function.

As a result of these failings, SBUK’s staff did not appreciate the need to comply with AML requirements, and the MLRO function was ineffective in monitoring their compliance. This led to systemic failures in SBUK’s AML systems and controls throughout the business.

The FCA initially decided to impose a financial penalty of £76,400 on Mr. Prodhan in May 2018. Mr. Prodhan referred the case to the Upper Tribunal, where proceedings have been delayed significantly as a result of the pandemic and limitations on Mr. Prodhan’s ability to travel to the UK from Bangladesh, where he now resides.

While the FCA considers the financial penalty to be appropriate, there now exist exceptional circumstances for the case to be resolved by agreement, including the lack of any prospect of enforcing payment of a financial penalty.

Mr. Prodhan has withdrawn his referral to the Upper Tribunal and agreed to accept a public censure.

Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA, said:

‘Mr. Prodhan failed to maintain proper anti-money laundering systems and allowed a culture of non-compliance among the bank’s staff.

‘While a financial penalty was appropriate in this case, prolonged litigation to enforce a penalty that is unlikely to be paid against a person who may not be able to travel to the UK to explain himself to the Upper Tribunal is neither practical nor fair. In these exceptional circumstances, a public censure is an appropriate resolution of the case.’

In line with its three-year strategy, the FCA continues its work to prevent potential harm to consumers and the market. The regulator has been transparent that firms doing business in the UK must meet its high standards.

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