Jurisdiction(s):
United Kingdom

FCA’s £44m Nationwide AML fine: UK hard-line on operational effectiveness, whole-of-customer monitoring and swift remediation; expect steeper penalties for Principle 3 breaches across financial services

Published on: 18 December 2025

Published by a Law360 reporter

Legal News

Article summary

Lawyers are urging banks, building societies, insurers, asset managers, and others to take lessons from the FCA’s 12 December 2025 action against the world’s largest building society, warning that robust policies alone won’t suffice. They say the regulated sector now faces far heftier penalties for comparable compliance lapses. Neil Swift, a partner at Peters & Peters Solicitors LLP, noted this forms part of a pattern of sizeable sanctions for weak financial controls, stressing that the regulator will adopt a tough stance where systems fall short.

Future AML fines could soar

The penalty might have reached £1.66bn had the FCA imposed a charge equal to 15% of relevant revenues, the “level-four factor”, which it considered commensurate with the seriousness of the breach. Even so, the FCA concluded that such a figure was disproportionate in view of Nationwide’s remedial measures, and scaled it back markedly. Lawyers warn that firms which have shrugged off the FCA’s message and failed to assess existing and new clients properly are at risk, and that institutions with comparable deficiencies subjected to future enforcement action may...

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