In the first major fine of 2004, the industry watchdog the Financial Services Authority slapped Halifax Group's Bank of Scotland with a £1.2m fine.
The fine was as a result of not keeping proper customer identification records, in line with the Money Laundering regulations. The matter was worsened when BOS could not determine where the problems started.
Apparently, over 50% of files checked during 2002 showed no copies of identification evidence for the customer.
Our View
With the problems in our society, Money Laundering Regulations are now taken far more seriously by all.
Obtaining evidence that a customer is who they say they are is vital to combat financial fraud. This means that stricter rules and regulations have had to be put in place by all companies affected.
Whilst we cannot condone the apparently lack of evidence of their customers, BOS are a huge group with many hundreds of staff to monitor and train. Whilst everyone makes mistakes, BOS will have to tighten up their procedures and ensure constant monitoring is carried out.