Banking: Financial Crime

Baroness Kramer Excerpts

Wednesday 2nd December 2015 Lords Chamber

[Lord Bridges of Headley]

My Lords, I echo the point made by the noble Lord, Lord McFall: the financial companies face severe financial penalties. Furthermore, a new criminal sanction was created by the previous Government for those who manage firms in a reckless manner.

[Baroness Kramer (LD)]

My Lords, the sophisticated and complex money laundering scheme for nearly £2 billion of Middle Eastern money is unlikely to have been a one-off. What assurances can the Minister give the House that this transaction and others like it were not using funds from terrorism or that the funds generated were used for terrorism?

[Lord Bridges of Headley]

My Lords, I am sorry but I cannot go into greater detail on that point. However, I draw the noble Baroness’s attention to the fact that, under the FCA’s rules, money laundering reporting officers will have to be senior managers. The FCA will also require firms to allocate overall responsibility for the firm’s policies and procedures for countering the risk that the firm might be used to further financial crime to an approved senior manager, who could be the MLRO but does not have to be. This will ensure that there is accountability for financial crime matters at the top executive level.