ALEX BRUMMER: NatWest takes the shame after breakthrough victory for the Financial Conduct Authority
Anyone who has tried to retrieve cash from their bank to settle an invoice from a builder, or sought to open an account for a small charity, will know it isn’t easy.
Money laundering laws can make even innocent bank users feel as if they are handling dirty money.
It is hard to believe that staff at Natwest’s branch network did not recognise anything was amiss when Fowler Oldfield, a Bradford jewellery firm, made across-the-counter payments of £365million between 2012 and 2016, of which £264million was in cash.
Suspicious: Fowler Oldfield, a Bradford jewellery firm, made across-the-counter payments of £365m between 2012 and 2016, of which £264m was in cash
Little is publicly known about this curious affair as there are cases against 13 individuals allegedly involved in the scam still to be heard.
It seems extraordinary that as far as we know, criminal activity was taking place and big sums passed through the branches without members of Natwest staff locally or in head office having some knowledge.
Natwest’s admission of guilt at Westminster Magistrates’ Court is something of a breakthrough for City enforcer, the Financial Conduct Authority, using a 2007 money laundering law.
Much of the investigatory work was done by West Yorkshire Police and the National Crime Agency. Nevertheless, it can be chalked up as a FCA success.
The FCA’s failure to act to prevent the London Capital & Finance scandal and its embarrassingly slow investigation into the failure of Neil Woodford’s investment empire in 2019 means the regulator will take a victory from wherever it comes.
The last UK bank to be involved in a major money laundering scandal was HSBC. It was the subject of an excoriating Congressional investigation after £643million of Mexican and Colombian drug money was funnelled through its Mexican branch. Couriers would turn up satchels filled with cash.
HSBC was eventually fined £1.4billion by the US Justice Department and put on probation by the banking authorities.
In 2015 HSBC made a payment of £31million to the Swiss authorities to settle allegations of money laundering at its Swiss private bank in Geneva.
HSBC is estimated to spend more than £5billion a year on detecting fraud and complying with global regulations.
The shenanigans surrounding Natwest’s dealings with an old established jeweller and gold dealer in Bradford took place before chief executive Alison Rose took over.
Nevertheless, it is unhelpful as she struggles to cleanse the 55 per cent state owned bank of past stains.
The bank had a good pandemic by serving the needs of its small- and medium-sized business customers.
It used the vainglorious Fred Goodwin legacy HQ in Edinburgh as a food bank distribution centre for hard hit families. Now Natwest faces a potential fine of £340million. The regulatory clouds refuse to clear.
The Saudi Arabia Public Investment Fund will not be overpaying if it relieves Mike Ashley of Newcastle United for £305million.
Newcastle may lack the star-studded recent history of Manchester United or Juventus, both garlanded quoted clubs.
But the valuation of Newcastle at 1.7 times turnover compares with 4.1 times at Man Utd and 2.1 times at Juve.
Supporters will be glad to see the back of Ashley, who never endeared himself. A new ranking of Premier League teams for their finances and popularity by gaming site Freebets.com ranks Newcastle as 18th out of 20 Premier League clubs.
At the top of the rankings as good owners are Russian oligarch Roman Abramovich at Chelsea and the Thai tycoons at Leicester.
The sight of a money bags being brought to the table by financial fixer Amanda Staveley will lift the spirits of fans who can point to Manchester City and PSG as examples of what Gulf cash can achieve.
Yet the memory of the brutal murder of journalist Jamal Khashoggi hangs heavily over the reputation of Crown Prince Mohammed bin Salman, who heads the sovereign wealth fund.
The aftermath of the Khashoggi affair is still holding up the sale of a new generation of BAE Tornado fighters to the Kingdom.
The Premier League doesn’t really need another foreign owner in bad odour.
Britain is not the only nation experiencing a spot of bother.
The high-skilled, high-paid German economy experienced a 50 per cent drop in industrial output in August due to supply chain problems, ranging from a shortage of microchips and other components.
Orders also fell. Not great for the EU’s manufacturing locomotive.