Barclays Bank UK has agreed to make a voluntary payment of £6.3m to clients of WealthTek after the Financial Conduct Authority (FCA) found it had failed to gather sufficient information on the money laundering risk posed by the wealth management firm.

The bank had opened a client money account for WealthTek, which is now in administration, with clients going on to deposit £34m into the account.

The FCA said that if Barclays had checked the Financial Services Register before opening the account, it would have seen that WealthTek did not have regulatory permission to hold client money.

Therefore, it did not have the right information about the wealth management company and how the account would be used, resulting in an increased risk of misappropriation of client money or money laundering.

Barclays has therefore agreed to make a voluntary payment of £6.3m to WealthTek’s clients who have a shortfall in the money they have been able to reclaim.

It was also fined £3.01m by the FCA for failings in its financial crime risk management in relation to the case.

The FCA has charged former WealthTek principal partner, John Dance, with nine criminal offences, including multiple counts of fraud and money laundering, and his trial has been scheduled for September 2027.

In a second separate case, Barclays has been fined £39.3m by the FCA for failing to adequately manage money laundering risks associated with providing banking services to Stunt & Co.

The regulator said Barclays did not gather enough information at the start of the relationship or carry out proper ongoing monitoring.

In just over a year, Stunt & Co received £46.8m from Fowler Oldfield, a multimillion-pound money laundering operation.

The FCA said that Barclays failed to properly consider the money laundering risks associated with the firm and facilitated the movement of funds linked to financial crime by providing banking services to Stunt & Co.

“The consequences of poor financial crime controls are very real – they allow criminals to launder the proceeds of their crimes, and they allow fraudsters to defraud consumers,” said FCA joint executive director of enforcement and market oversight, Therese Chambers.

“Banks need to take responsibility and act promptly, particularly when obvious risks are brought to their attention.

“In the first of these cases [WealthTek], Barclays secured a significant reduction in its fine through its extensive co-operation with our investigation and through making a voluntary payment to affected consumers at our request.”

Barclays continues to engage and invest in a significant remediation programme to enhance its anti-money laundering control framework.

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