Barclays Under Fresh Scrutiny as FCA Launches Financial Crime Investigation

The Financial Conduct Authority (FCA) has initiated an enforcement investigation into Barclays’ compliance with anti-money laundering controls, marking yet another regulatory challenge for the troubled British banking giant.

The FTSE 100 lender revealed in its Thursday annual report that the investigation centres on the bank’s historical oversight of high-risk customers. This latest probe adds to a growing list of regulatory headaches for the organisation, which has struggled to shake off years of controversy.

In a separate development, Barclays disclosed an ongoing dispute with HM Revenue & Customs regarding the interpretation of UK bank levy legislation. The tax authority notified Barclays of its intention to challenge the bank’s treatment of certain matters in December 2024.

The timing proves particularly challenging for Chief Executive CS Venkatakrishnan, known as Venkat, who has been working to rehabilitate the bank’s image since taking the helm in late 2021. His leadership began under the shadow of an $18 billion structured products mishap in the US, resulting in a $361 million settlement with American regulators.

The bank’s regulatory woes have been persistent. In November, Barclays agreed to a £40 million FCA fine related to controversial Qatari investor dealings during the 2008 financial crisis. The appointment of Venkat himself followed the departure of previous CEO Jes Staley, who stepped down amid an FCA investigation into his connections with Jeffrey Epstein.

Staley continues to contest the watchdog’s 2023 decision to impose a £1.8 million fine and ban him from senior financial services roles in the UK over allegations he “recklessly misled” the regulator about his Epstein relationship.

While Barclays has confirmed its cooperation with the latest FCA investigation, the regulatory body has declined to comment on the inquiry into the bank’s financial crime controls.