Starling Bank Limited has been fined £28,959,426 by the FCA for failures in financial crime controls, including breaches related to sanctions screening and opening accounts for high-risk customers.

Starling’s rapid growth—from 43,000 customers in 2017 to 3.6 million by 2023—outpaced its efforts to combat financial crime.

In a 2021 FCA review of challenger banks, serious issues were found in Starling’s anti-money laundering and sanctions protocols. Despite agreeing to restrictions on opening accounts for high-risk customers, Starling violated these terms, opening over 54,000 accounts for 49,000 high-risk customers between September 2021 and November 2023.

In January 2023, Starling uncovered a critical flaw in its automated screening system, which since 2017 had only been screening a portion of customers against financial sanctions lists. A subsequent internal review revealed systemic failures in its sanctions framework, prompting Starling to report several breaches to authorities.

Therese Chambers, Joint Executive Director of Enforcement and Market Oversight, criticized Starling’s “lax controls,” which left the financial system vulnerable to exploitation by criminals and sanctioned individuals. The FCA, however, noted that this case reached a resolution in just 14 months—much faster than the average 42 months for such investigations.

Starling has since implemented significant improvements to its financial crime controls, and the FCA continues to monitor firms to ensure robust systems are in place.