Sonali Bank (UK), which is majority-owned by the Bangladeshi government, had weaknesses that allowed suspicious money transfers from its six British branches without proper checks.
The Financial Conduct Authority has also taken the unusual step of banning Sonali from accepting new banking customers for almost six months, saying that it gave warnings to the company about its lax money laundering controls in 2010 and repeatedly afterwards.
Since 2014, when the FCA told the bank to tighten up its controls after an external review, Sonalis revenues have fallen by a third to GBP 6.75 million. The company has said it will cut its branches down to two by the end of the year.
The bank carried out its own review of its trade finance customers in 2013, finding problems with more than eight in 10 applications, but did not do enough to tighten up its checks, the FCA said.
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