Commodities trader ADM has been fined £6.5 million by the Financial Conduct Authority (FCA) for failing to install adequate anti-money laundering (AML) controls despite being warned more than eight years ago.
According to the watchdog, the company's AML customer assessment was "basic" and did not allow a proper assessment of their financial crime risk.
ADM Investor Services, a subsidiary of a US firm, has 2,000 business and personal customers including asset managers and high net worths.
Policies at the company referred to AML regulations that were around 12 years out-of-date and had been replaced twice, said the FCA.
The regulator found 37 open accounts with clients linked to countries on a supposed red or prohibited list of places.
ADM’s internal auditors had repeatedly, in 2010, 2012, 2014 and 2015, warned of inadequacies, said the regulator.
By agreeing to pay the fine early, ADM received a discount of more than 60% on the fine proposed.
Therese Chambers, joint executive director of enforcement and market oversight, said: “All financial firms need to have effective anti-money laundering checks in place.
“ADM Investor Services’ failures put it at risk of being used to facilitate financial crime.
“These failings continued even after the firm had received clear warnings on the need to improve its systems.”
ADM said: “While no actual harm was identified, ADMISI recognises that the systems in place to mitigate those risks during this period fell short of the expected standards.”