Regulation  

Aberdeen credit union’s unorthodox practice

An Aberdeen-based credit union has been investigated by the FCA for using an employee’s personal account to speed up payments for members.

St Machar Credit Union set up personal accounts with six banks in the name of an employee and used them to facilitate faster payments to members between 2009 and December 2014.

The FCA has said the credit union failed to consider the risks associated with this arrangement, including the loss of control and/or legal rights to monies once the funds had been transferred to the personal accounts. Ruling that SMCU’s behaviour fell foul of its Principles of Business, the FCA has required it to publish a statement to that effect on its website for six weeks.

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The credit union has given a voluntary undertaking to never again use personal bank accounts to facilitate its business.