West London money transmitter Touma Foreign Exchange Ltd ignored anti-money laundering regulations and received a £7.8m penalty.
The company was fined by HMRC for “a wide-range of serious failures under the Money Laundering Regulations”.
Between June 2017 and September 2018, the business breached rules on:
• Risk assessments and associated record-keeping
• Policies, controls and procedures
• Fundamental customer due diligence measures
• Adequate staff training
Mr Hassanien Touma was banned on 20 May from any management roles at a business governed by anti-money laundering regulations after he acted as an officer for the MSB.
Individuals are required to pass a vetting test to ensure they are fit and proper to carry out the role and Mr Touma failed to do this.
The fine was announced following a separate HMRC, Metropolitan Police and FCA month-long crackdown on money senders at risk of being used for washing dirty cash to fund organised crime, drug trafficking, violence and terrorism.
During the July crackdown, Metropolitan Police and HMRC officers executed warrants at 12 addresses in West London and seized evidence of money laundering.
On 3 July Met officers arrested two men in central London and seized £100,000 cash intended for an MSB.
On 12 July, after an investigation by HMRC assisted by the MPS, Shunjian Jiang, a London man, was given a suspended jail sentence for trading as an MSB, without being registered for anti-money laundering supervision.
The judge ruled that Mr Jiang’s home in Colindale, London, was bought using the proceeds of crime because he was illegally trading as an MSB without being registered with HMRC and would be subject to confiscation proceedings.
As part of the commitment to educate businesses, HMRC and Met officers visited 40 MSBs in the Queensway area of London and reminded them of their obligations under the Money Laundering Regulations.
Leaflets were hand-delivered to all 9,000 MSBs across London during July and August to highlight the money laundering risks and need to properly manage these.
HMRC officers also visited five money service businesses assessed to be at a higher risk of being used for money laundering and are taking civil action against four of them for failing to take adequate measures to protect themselves from criminal abuse.
Simon York, director of HMRC’s Fraud Investigation Service, said:“Money laundering is the lifeblood of the illicit drugs trade, human trafficking and other serious crimes which bring harm and misery to communities across our country.
“It also supports economic crime which costs the UK billions of pounds every year.
“We know that criminals use MSBs to disguise and move dirty money, and we’re determined to thwart them by helping businesses avoid being exploited in this way.
“However, a word to the wise for those firms who, either by ignorance or design, continue to flaunt the rules – this record fine shows we mean business, so get your house in order before we come knocking.”