£500,000 penalty for wealth management firm which breached regulations

FSA imposes 'civil penalty' on Nedbank Private Wealth Limited

A wealth management company on the Isle of Man has been fined more than half a million pounds after contravening anti-money laundering regulations.

The Financial Services Authority has imposed a ‘civil penalty’ on Nedbank Private Wealth Limited which is based on Hill Street in Douglas.

It follows an investigation which started in May 2022 after Nedbank’s statistical return, from 2018, indicated a ‘high proportion of foreign politically exposed persons’.

In light of that Nedbank was selected to be part of a ‘thematic project’ undertaken by the FSA - this identified a number of contraventions of the Anti-Money Laundering and Countering the Financing of Terrorism Code 2019.

These included a lack of detail in risk assessments for FPEP’s, insufficient evidence of due diligence, inadequate documentation of sources of funds or wealth and ineffective ongoing monitoring.

The FSA said it was therefore appropriate, necessary and proportionate to require Nedbank to pay a penalty.

The starting point of this imposition was £764,550 but this was reduced by 30 percent to £535,185 due to ‘significant mitigating factors’.

Nedbank, the authority said, had co-operated fully with the authority, engaged promptly and positively and agreed settlement at an early stage which was reflected in the level of penalty imposed.

The FSA says it acknowledges the ‘constructive dialogue’ between Nedbank and the authority, which is ongoing, adding the company has already taken ‘substantial steps’ to address matters.

Today (18 December) the FSA has issued a public statement concerning the civil penalty saying it’s committed to taking appropriate and proportionate action to address contraventions.

It says doing so supports the regulatory objectives of securing an appropriate degree of protection for customers, reducing financial crime and maintaining confidence in the Isle of Man’s financial services industry.

You can read the statement in full HERE.