Santander has terminated UK consultancy EY after discovering failures in its work to prevent financial crime and money laundering. The “Big Four” was one of the consultants the bank turned to to strengthen its systems after pressure from the British Banking Supervision Authority, which is increasingly focused on preventing financial crimes.
According to the Financial Times, the work carried out by EY was so poor that the professional services company was forced this year to offer the bank a refund of about 15 million pounds sterling for the project (17 million euros annually). The business, known as Project Morgan, “went very poorly over a long period” and the deal affected the results of the consultancy's UK financial services division.
At the end of 2022, Santander agreed with the UK to a fine of 125 million euros after the supervisor discovered “deficiencies” in its protocols to prevent money laundering. The Financial Conduct Authority (FCA) has concluded that Santander UK failed to adequately monitor and manage its systems, which “significantly” affected the monitoring of the accounts of more than 560,000 business customers. For this reason, the Bank sought to strengthen these prevention systems.
The sanction refers to an investigation that spanned from 2012 to 2017 and coincides with the years when the UK's Santander bank was in the process of merging the banks it had bought in the UK in the midst of the financial crisis: Alliance & Leicester and Bradford. & Bingley.. Likewise, the bank added that in recent years it has invested £700 million in a program to transform the framework through which it manages financial crimes in the United Kingdom.
“We have made significant changes to our technology, systems and processes to transform our prevention framework. Today, there are more than 4,400 professionals dedicated to fighting financial crime. We will continue to invest in the future and do everything We do our best to ensure the safety of all our customers and the communities in which we operate.”
On EY's part, the failure of Project Morgan was accompanied by a reduction in staff in the UK Financial Crimes Advisory Team. Many members of this band, made up of about 150 people, are about to be fired. According to what several sources told the Financial Times, the Santander case was not the motivation behind these dismissals, but rather a broader process. Likewise, the company noted that the contract termination continues to work with Santander in other countries around the world on multiple issues.
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