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FSA/PN/125/2008
29 October 2008

The Financial Services Authority (FSA) has today fined Sindicatum Holdings Limited (SHL) £49,000 and its money laundering reporting officer (MLRO), Michael Wheelhouse, £17,500 for not having adequate anti-money laundering systems and controls in place for verifying and recording clients’ identities. This is the first time the FSA has fined a money laundering reporting officer.

The FSA found a number of failings including:

• the firm failed to implement adequate procedures for verifying the identity of its clients;
• it failed to verify adequately the identity of a significant number of its clients;
• it failed to keep adequate records with regard to the verification of the identity of its clients; and
• Mr Wheelhouse failed to take reasonable steps to implement adequate procedures for controlling money laundering risk.

William Amos, head of retail enforcement at the FSA, said:

"It is vital to the integrity of the UK’s financial markets that regulated firms are not used by criminals to launder money.  Senior management must implement and follow procedures that meet our requirements so that the risks their firms face are properly managed.

"This fine is a warning to firms and individuals about the importance of complying with our rules in this area and we will not hesitate to clamp down on failures, where necessary." 

In deciding the penalty for SHL, the FSA took into account the limited financial resources of the firm and its ability to pay the fine.  Had it not been for these factors the penalty would have been significantly larger.

SHL and Mr Wheelhouse have taken robust steps to review and improve the firm’s systems and controls in relation to financial crime.
The FSA did not find any evidence of money laundering at the firm.

Notes for editors

1. The Final Notices for Sindicatum and for Mr Michael Wheelhouse can be found on the FSA website.
2. Sindicatum Holdings Limited is a corporate advisory firm based in London with small and medium sized corporate clients in countries including Lithuania, Slovenia, Russia, Hungary, the Czech Republic and the UK.
3. The FSA has a statutory responsibility to reduce the extent to which it is possible for a business carried on by a regulated person to be used for a purpose connected with financial crime.
4. The FSA regulates the financial services industry and has four objectives under the Financial Services and Markets Act 2000: maintaining market confidence; promoting public understanding of the financial system; securing the appropriate degree of protection for consumers; and fighting financial crime.
5. The FSA aims to promote efficient, orderly and fair markets, help retail consumers achieve a fair deal and improve its business capability and effectiveness.