FCA and PRA fines and enforcement actions in 2019

Between 19 June 2014 and 31 December 2018 Citigroup’s UK entities failed to organise and control their affairs responsibly and effectively, submitted incomplete or inaccurate notifications to the regulator, and (for the branches) failed to provide required branch information to the PRA. The Prudential Regulation Authority (part of the Bank of England) fined Citigroup Global Markets Limited, Citibank N.A. London Branch and Citibank Europe Plc UK branch £43,890,000 under section 206 of the Financial Services and Markets Act 2000. The PRA’s final notice is published on the Bank of England website.

In June 2019 the FCA fined Bank of Scotland £45.5 million for failing to be open with the regulator about suspected fraud at HBOS's Reading-based Impaired Assets office, where a team led by Lynden Scourfield had been pushing struggling small businesses towards outside consultants who stripped their assets for personal gain. The bank first identified suspicious behaviour in early 2007 — including that Scourfield had been approving lending beyond his authority for three years — but did not fully disclose its suspicions to the then regulator, the Financial Services Authority, until July 2009, and the FCA found there was insufficient challenge or scrutiny "from top to bottom" of the organisation. The FCA said the delay hampered investigations by both the regulator and Thames Valley Police. The bank agreed to settle and received a 30% discount, cutting the fine by almost £20 million; the FCA also banned four individuals involved in the fraud.

The FCA fined Goldman Sachs International £34,300,700 on 27 March 2019 for failures in its transaction reporting. The Final Notice says the firm breached SUP 17 between 5 November 2007 and 31 March 2017, and breached SUP 15 and Principle 3 between 5 November 2007 and 31 March 2015, in relation to its transaction reporting obligations. Principle 3 requires a firm to take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems. Goldman Sachs agreed to resolve the matter and qualified for a 30% executive settlement discount; without that discount the penalty would have been £49,063,900.

The FCA found that UBS breached Handbook rules on regulatory reporting (SUP 17) between 5 November 2007 and 24 May 2017, and breached SUP 15 and Principle 3 between 5 November 2007 and 31 July 2014, in relation to its transaction‑reporting obligations. The FCA imposed a fine of £27,599,400, taking effect on 18 March 2019; UBS agreed to settle and therefore received a 30% (stage 1) executive settlement discount (the undiscounted penalty would have been £39,427,795). Principle 3 requires firms to take reasonable care to organise and control their affairs responsibly and effectively; SUP 15 and SUP 17 are Handbook provisions covering notifications to the FCA and regulatory/transaction reporting obligations respectively.