BNY Mellon to pay £126-million penalty

The United Kingdom’s Financial Conduct Authority (FCA) has fined The Bank of New York Mellon London branch and The Bank of New York Mellon International Limited £126 million ($231.7 million) for failure to comply with custody rules.

“Our custody rules are in place to ensure that clients are protected in the event of insolvency,” says Georgina Philippou, acting director of enforcement and market oversight at the FCA. “Had the firms become insolvent, the total value of safe custody assets at risk would have been significant.”

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The rules require firms to keep entity-specific records and accounts.

BNY Mellon has agreed to pay the penalty and the amount is “fully covered by pre-existing legal reserves.”

The company says no clients suffered any loss as a result of the issues identified by the FCA.

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