The Financial Conduct Authority has publicly censured Mohammad Ataur Rahman Prodhan, the former Chief Executive Officer of Sonali Bank (UK) Limited (SBUK) “for anti-money laundering (AML) failings.”
Prodhan was “the senior manager at SBUK with responsibility for the establishment and maintenance of effective AML systems and controls.”
Between 7 June 2012 and 4 March 2014, Prodhan reportedly “failed to take reasonable steps to assess and mitigate the AML risks arising from a culture of non-compliance among SBUK’s staff.”
He allegedly failed “to ensure that there was a clear allocation of responsibilities to oversee SBUK’s branches, and he also failed to properly oversee, manage, and resource SBUK’s Money Laundering Reporting Officer (MLRO) function.”
As a result of these failings, SBUK’s staff “did not appreciate the need to comply with AML requirements, and the MLRO function was ineffective in monitoring their compliance.” This led “to systemic failures in SBUK’s AML systems and controls throughout the business.”
The FCA initially “decided to impose a financial penalty of £76,400 on Mr Prodhan in May 2018.” Prodhan referred the case to the Upper Tribunal, “where proceedings have been delayed significantly as a result of the pandemic and limitations on Prodhan’s ability to travel to the UK from Bangladesh, where he now resides.”
While the FCA considers the financial penalty to be appropriate, “there now exist exceptional circumstances for the case to be resolved by agreement, including the lack of any prospect of enforcing payment of a financial penalty.”
Prodhan has “withdrawn his referral to the Upper Tribunal and agreed to accept a public censure.”
Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA, said:
“Mr Prodhan failed to maintain proper anti-money laundering systems and allowed a culture of non-compliance among the bank’s staff. While a financial penalty was appropriate in this case, prolonged litigation to enforce a penalty that is unlikely to be paid against a person who may not be able to travel to the UK to explain himself in person to the Upper Tribunal is neither practical nor fair. In these exceptional circumstances, a public censure is an appropriate resolution of the case.”
In line with its three-year strategy, the FCA “continues its work to prevent the potential for harm to consumers and the market.” The regulator “has been clear that firms doing business in the UK must meet its high standards.”
The FCA has “concluded that it is appropriate to replace the financial penalty with a public censure because of exceptional circumstances in this case.”
These include Mr Prodhan “returning to Bangladesh and no longer having income or assets in the UK; the fact he is no longer in employment in Bangladesh; ongoing personal conditions which limit his ability to travel to the UK for the Upper Tribunal; and the length of time since his misconduct which has been impacted by Covid-delays to the litigation.”
In August 2022, “following regulatory action by the Prudential Regulation Authority, SBUK cancelled its authorization and renamed itself Sonali Bangladesh (UK) Ltd.”
The FCA has “an overarching strategic objective of ensuring the relevant markets function well.”
To support this, “it has three operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system; and to promote effective competition in the interests of consumers.”
