The Financial Conduct Authority (FCA) has fined Metro Bank £16,675,200 after finding that the challenger bank failed to adequately monitor over 60 million transactions, with a value of over £51 billion, for money laundering risks.

The FCA said that between June 2016 and December 2020, Metro failed to have the right systems and controls in place, with the bank’s automated monitoring systems not working as intended, allowing potential financial crimes to slip through with authentic customer transactions.

The regulator said that an error in how data was fed into the system meant transactions taking place on the same day an account was opened, and any further transactions until the account record was updated, were not monitored.  

Although junior staff raised concerns about some transaction data not being monitored in 2017 and 2018, the issue was only identified and fixed in July 2019. Even once that fix had been put in place, however, the FCA claims that Metro didn’t have a mechanism to consistently check all relevant transactions were being fed into the monitoring system until December 2020, over four and a half years after the system was introduced.

“Metro’s failings risked a gap being left in our defence against the criminal misuse of our financial system. Those failings went on for too long,” said Therese Chambers, joint executive director of enforcement and market oversight at the FCA.

Metro said that it accepted the FCA’s findings, and having agreed to resolve the matter managed to avoid what would have been a £23.8 million fine by qualifying for a 30% reduction.

In 2022, Metro Bank, along with two of its former executives, was fined more than £10 million by the financial regulator after misleading investors in an accounting scandal that misreported the assets used to calculate how much capital it needed.

That scandal led to the near collapse of the bank and another £5 million fine from the Prudential Regulation Authority, with its share price plummeting from a high of nearly £40 to just 60p in October 2020, causing an exodus of investors it fought to retain.

Attempting to turn the tide, Metro agreed to a £925 million bail out from Columbian billionaire Jaime Gilinski Bacal in 2023, with the investor now owning more than half of the bank’s equity. 

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In March, Metro announced that it would be laying off 1,000 employees, and with the prospect of more to come, in an effort to increase cost cutting measures and save £80 million over the course of the year.

Metro, however, isn’t the only bank to come under fire for its apparently lax security systems. Last month, the FCA fined Starling Bank £29 million for similar failings in its financial crime systems and controls, with the regulator voicing “serious” concerns with the anti-money laundering and sanctions framework in place.