Britain’s financial regulator, the Financial Conduct Authority (FCA), has fined digital bank Monzo £21.1 million ($28.57 million) for inadequate anti-financial crime systems and controls. The FCA highlighted failures in Monzo’s procedures between October 2018 and August 2020, including accepting customers who used well-known landmarks such as Buckingham Palace and 10 Downing Street as their addresses.
As Monzo expanded rapidly, it did not maintain sufficient safeguards to prevent financial crime risks, the FCA said in a statement issued Tuesday. After a 2020 review, the FCA imposed restrictions preventing Monzo from opening accounts for high-risk customers. However, from August 2020 to June 2022, Monzo repeatedly breached this requirement, onboarding over 34,000 high-risk customers.
Therese Chambers, FCA joint executive director of enforcement and market oversight, said, “Monzo onboarded customers on the basis of limited, and in some cases, obviously implausible information — such as customers using well-known London landmarks as an address. This illustrates how lacking Monzo’s financial crime controls were.”
Monzo’s CEO TS Anil acknowledged the issues but stressed that the problems have been resolved and substantial improvements have been made. Monzo remains committed to fighting financial crime.
Launched in 2015, Monzo is among the fastest-growing fintech firms in the UK. Yet, regulatory scrutiny has increased over financial crime controls in fintechs; Starling Bank was fined £29 million in 2024 for similar failings in anti-money laundering and sanctions screening systems.
Despite the fine, Monzo reported strong financial performance in its latest results, with pretax profit rising to £60.5 million for the year ending March 31, 2025, compared to £13.9 million the previous year. CEO Anil said it was too early to discuss a potential IPO.