A Money Services Business (MSB) has been handed a record fine after breaching money laundering regulations, a report has revealed.
The record fine, levied by HM Revenue & Customs (HMRC), forms part of a month-long crackdown on businesses at risk of being used for money laundering to fund organised crime.
According to the report, west London-based business Touma Foreign Exchange has been fined £7.8 million for a “wide range of serious failures”.
HMRC found that the money transmitter “ignored” anti-money laundering regulations and breached rules on risk assessments and record keeping, policies, controls and procedures, fundamental customer due diligence measures and adequate staff training.
Company director Mr Hassanien Touma was also banned from running further MSBs after failing to pass a vetting test to ensure he was fit and proper to effectively carry out the role.
Commenting on the case, Simon York, Director of HMRC’s Fraud Investigation Service, said the business may have enabled criminals to “wash” dirty money.
“We know that criminals use MSBs to disguise and move dirty money, and we’re determined to thwart them by helping businesses avoid being exploited in this way,” he said.
“However, a word to the wise for those firms who, either by ignorance or design, continue to flaunt the rules – this record fine shows we mean business, so get your house in order before we come knocking.”
Providing they are not already supervised by the Financial Conduct Authority (FCA), an MSB, such as a currency exchange office or money transmitter, is legally required to register with HMRC under the Money Laundering Regulations and follow the EU Funds Transfer Regulation.
The latest statistics suggest that HMRC has now recovered more than £41 million using the confiscation, civil recovery and cash forfeiture regimes in the Proceeds of Crime Act and successfully prosecuted 32 individuals for money laundering offences and failing to follow regulations.
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