Accountancy Giant EY Pays Santander £15m for AML Failings

Logo at branch of Santander bank.

‘Big Four’ member consultancy firm Ernst & Young (EY) has repaid banking group Santander £15m after it failed to help the Spanish lender improve its anti-money laundering (AML) controls, reports suggest.

EY has agreed to terminate its consulting contract and will refund the sum to Santander’s UK business after failings in its anti-financial crime work for the bank, according to a report in the Financial Times.

Consultant EY was one of several advisers enlisted by Santander to work on ‘Project Morgan’, which was set up to address deficiencies in the bank’s AML controls.

However, sources suggest the work “went badly wrong over an extended period”, resulting in EY’s involvement being terminated and the consultancy giant agreeing to the financial settlement as compensation.

The project’s failure has been followed by the prospect of cutbacks in EY’s UK financial crime advisory team, according to insiders. The team currently has 150 members.

Santander was fined a whopping £107.7m by the Financial Conduct Authority (FCA) in December 2022 for “serious and persistent gaps” in its AML controls over the five-year period between 2012 and 2017.

Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA, said: “Santander’s poor management of their anti-money laundering systems and their inadequate attempts to address the problems created a prolonged and severe risk of money laundering and financial crime.

“As part of our commitment to prevent and reduce financial crime, we continue to take action against firms which fail to operate proper anti-money-laundering controls.”

The Spanish bank has invested over £700m in a “major change programme to transform [its] bank-wide financial crime framework” in the past five years, according to reports.

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