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Eighty-six of the record 504 investigations the U.K. Financial Conduct Authority was actively pursuing as of Apr. 1, 2018, targeted suspected financial crimes, compared to 56 such cases at the same point in 2018 and just 20 in 2016, according to the agency and data reviewed by ACAMS moneylaundering.com.

But the high volume of investigations did not translate into a significant volume of enforcement. The first of two total penalties issued by the FCA last year for anti-money laundering infractions came in January, when IBUK, a London-based online broker, consented to a £1 million fine for failing to report suspicious transactions.

In June, Canara Bank agreed to pay nearly £900,000 and refrain from taking on new clients for five months to address a series of “endemic” breaches.

From 2012 to 2016, according to the regulator, the Bengaluru, India-headquartered lender failed to vet clients adequately, train staff for AML purposes and ensure that senior managers understood financial-crime risks and local regulations.

Guy Wilkes, former enforcement chief for the FCA, attributed the increase in total investigations to the agency’s relatively recent practice of running parallel investigations into institutions and senior managers, and launching inquiries regardless of available resources.

“For the last two or three years the FCA has made it a priority to start enforcement actions against senior individuals where appropriate,” said Wilkes, now an attorney with Mishcon de Reya in London. “It’s much more likely now than in the past to include individuals as formal subjects of the investigation—that’s now routine.”

As a consequence of the higher volume, individual investigations that progress all the way to disciplinary proceedings may take significantly longer to conclude.

“One would expect with a significant increase in the number of investigations, that these will ultimately feed through to a number of outcomes in due course,” Wilkes told moneylaundering.com. “We haven’t seen that yet, but it may happen.”

The Gambling Commission was the most prolific AML regulator in the United Kingdom last year in both volume and value, having disclosed enforcement actions against six gaming firms and collected more than £24 million in fines and other enforcement-related payments. In 2017, the gaming regulator issued one enforcement action and £80,000 in total penalties.

The Serious Fraud Office did not assess a single penalty in 2018 after fining Rolls-Royce more than £510 million pounds in January 2017 for bribery and corruption.

Two years after disclosing the fine, the SFO informed several individual suspects in the case that they were no longer under investigation.

The Netherlands

In September, Dutch lender ING consented to a record €775 million penalty and disgorgement after admitting to AML compliance deficiencies that allowed criminals to launder hundreds of millions of euros “virtually undisturbed” from 2010 to 2016.

Dutch prosecutors specifically accused the Amsterdam-based bank of failing to fund and staff its AML program for several years, resulting in inadequate client vetting, transaction monitoring and suspicious activity reporting over that time frame.

Maud Bokkerink, former coordinator of AML and sanctions exams for the Dutch central bank, said that as a result of the investigation into ING, the regulator now more thoroughly assesses board members and other senior executives’ knowledge of compliance issues and efforts to mitigate risk.

“The lesson was that the bank never properly invested in compliance systems and staff, and that commercial considerations trumped investment in systems and controls,” Bokkerink told moneylaundering.com.

The message has not been lost on Dutch banks, many of which are allocating funds towards improving their compliance systems, Bokkerink said. “There’s currently enormous investment, particularly in first-line, KYC [know-your-customer] processes, as well as transaction-monitoring systems.”

A new sheriff in Europe

Last year saw the European Banking Authority, or EBA, launch investigations for the first time into national regulators suspected of failing to supervise financial institutions within their respective jurisdictions for AML purposes.

In November, EU officials instructed Malta’s Financial Intelligence Analysis Unit to react to AML violations more quickly and aggressively, revise how it levies penalties, tailor its supervision to each financial institution’s unique risk and keep more-detailed records of inspections.

The EBA concluded four months earlier that the agency failed in its duty to monitor Pilatus Bank, which lost its operating license shortly after U.S. officials arrested and charged ex-chair Ali Sadr Hashemi Nejad with money laundering and assisting Iran in evading U.S. sanctions.

Pilatus Bank also allegedly helped move and launder funds for Azerbaijani leaders as well as senior Maltese officials and their associates.

The EBA is still investigating Latvia’s Financial and Capital Markets Commission over its supervision of the now-defunct ABLV Bank, and Danish and Estonian regulators for their supervision of Danske Bank Estonia.

Jennifer Hanley-Giersch, managing partner at Berlin Risk, told moneylaundering.com that the scandals “have really rattled the cage of the European Union,” and the more prominent role that EU officials have assigned the EBA in AML supervision should motivate national regulators to up their game.

“With the EBA and other European institutions taking an interest in AML regimes and their implementation, it gives these matters a completely different level of importance,” she said. “The EBA has now started to publicly expose these failings, so sweeping the issues under the carpet is not going to work any longer.”

A blue Christmas in France, and more

France claimed the largest money-laundering penalty among EU nations in 2017 and the French Prudential Supervision and Resolution Authority, or ACPR, continued imposing significant fines in 2018—led by the €50 million penalty against Banque Postale on Christmas Eve.

The ACPR accused the lender of transferring funds on at least 75 occasions from 2009 to 2017 for at least 10 suspect individuals, including nine whose assets had been frozen for counterterrorism purposes.

In July, the ACPR levied a €100,000 fine against US money services business Sigue Global Services for a range of compliance violations, including failures to identify clients.

France’s Central Service of Races and Games, or SCCJ, closed down the last Parisian “cercle de jeux,” or gaming circle—the country’s version of a poker club—on suspicion of money laundering, embezzlement and alleged links to organized crime.

The club, known as the Cercle Clichy Montmartre, officially closed for administrative reasons, but its managers and owners face criminal charges.

French authorities imposed €70 million in AML-related regulatory penalties altogether on financial institutions last year, up from €18 million in 2017 and just €5 million in 2016.

Financial crimes of varying complexity were the subject of several prosecutions in France.

In October, a former director at HSBC Private Bank Suisse in Geneva was fined €200,000 after being found guilty of money laundering, while his brother, a director of a wealth-management company, was fined €1 million and sentenced to six years in prison.

The pair ran a network that collected and handed bags of drug cash to wealthy clients in France in exchange for transfers of the same amount directly from those individuals’ bank accounts in Switzerland. The group used the scheme to laundered roughly €12 million from 2010 to 2012.

“Money-laundering networks are becoming more professionalized, sophisticated and globalized,” Corinne Bertoux, chief of France’s Major Financial Crimes Office, told moneylaundering.com.

Across the Rhine, Germany’s Federal Financial Supervisory Authority, BaFin, issued 25 notices against persons subject to supervision under the country’s Money Laundering Act in 2018 and collected €3.7 million in total penalties.

Germany’s unprecedented pursuit of an administrative penalty against an AML officer last year “is a sign that regulation will be enforced more strictly,” former state prosecutor Dirk Scherp said. “There was no money laundering involved, she was convicted solely for reporting too late.”

German officials also opened an investigation into Deutsche Bank over the German lender’s links with Danske Bank Estonia, the Baltic lender at the center of a massive money-laundering scandal.

The Hong Kong Monetary Authority levied $2.3 million in total penalties in 2018 against JPMorgan Chase and Shanghai Commercial Bank for AML violations.

In June 2018, the Australia Transaction Reports and Analysis Center fined Commonwealth Bank of Australia the equivalent of $530 million after finding that the lender violated AML rules on more than 54,000 occasions.

Colby Adams, Kieran Beer, Larissa Bernardes, Laura Cruz, Leily Faridzadeh and Silas Bartels contributed to this article.