The Financial Conduct Authority received a total of 2,754 separate allegations of misconduct in the past 12 months, including fraud, money laundering and compliance complaints.
The data, from the FCA’s Annual Report and Accounts 2020-21 and analysed by the think tank Parliament Street, detailed the allegations - which were provided by 1,046 whistleblowers.
The report revealed there were 184 individuals and firms under investigation for carrying out unauthorised business, and £189.8m in financial penalties had been handed out over the same period, alongside a number of prosecutions alleging insider dealing, investment fraud or money laundering.
Due to changes in the way the FCA supervises firms, the number of firms required to submit financial crime-related data increased.
The year 2020-21 marked the first full financial year when the FCA was responsible for accessing the AML measures of cryptoasset businesses, which pose ‘increased risk of financial crime’.
In June and July, the regulator warned that a "significantly high number" of cryptoasset businesses are not meeting money laundering standards.
The 1,046 ‘whistleblowing’ reports was a small reduction when compared to the 1,100 reports in 2019-20, and this year 15 of those reports led to ‘significant action’ to mitigate harm, which may have included enforcement action.
In a further 135 cases they took ‘action’ to mitigate harm, which included writing to or visiting a firm, requesting further information, or asking a firm to attest to compliance with the rules.
Around 145 cases were said to have helped inform the FCA's work, and were relevant to the prevention of harm, but did not lead to any specific action; 97 cases were not considered relevant, and 654 cases were still being assessed at the time the report was published.
Wayne Johnson, chief executive at Encompass Corporation, said: “This year, more individuals are attempting to use the chaos of the pandemic to carry out financial crime. Therefore, it is important that the FCA is taking the necessary to steps to tighten their control and increase visibility over new sectors and payments technologies, such as cryptocurrencies, which are being used to launder money.
“But the fight against financial crime can’t be won by the regulators alone, and businesses from all sectors must improve the efficiency and effectiveness of their onboarding processes, compliance and due diligence, not just for the sake of ‘ticking boxes’ and averting regulatory fines, but to help prevent even more financial crime and dirty money running through critical businesses and infrastructure.”
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