Bank fined over identify lapse

One of Northern Ireland's largest banks has been fined £1.25m for failure to make proper checks on its customers.

The fine was imposed on the Northern Bank by the Financial Services Authority, under rules designed to prevent money laundering.

The Northern Bank admitted on Thursday that it had failed to keep proper records of details which customers opening new accounts are required to provide.

The bank said in a statement that it accepted the FSA's findings and had now addressed the problem.

Regulations which call for customers to give two forms of identification - photographic identification and proof of address, such as a utility bill - were breached.

The Financial Services Authority said the size of the fine demonstrated the importance it attaches to minimising risk of regulated firms being used for purposes connected to financial crime.

'Weaknesses'

FSA managing director Carol Sergeant said the Northern Bank's steps to verify customers' identities were "inadequate".

"Northern Bank had previously identified weaknesses in their customer identification procedures but allowed them to persist," she said.

"The size of the fine in this case reflects the prevalence of the breaches, Northern Bank's share of the market it operates in and its failure to take prompt and effective remedial action after it had originally identified its own failings."

Don Price, Northern Bank Chief Executive, said the FSA had noted that no money laundering had happened.

"We have since been working cooperatively with the regulator to ensure that our record keeping is now fully compliant," he said.

Northern Bank is the largest retail bank in Northern Ireland.

The FSA is an independent non-governmental body which regulates the UK financial services industry.