A British bank owned by Qatar and linked to Islamist organizations is under investigation over its money laundering controls.
The probe into Al Rayan by the UK’s Financial Conduct Authority (FCA) was launched last year and earlier this year the bank has been restricted on who it can open deposit accounts for.
The details of the investigation have surfaced weeks after it was reported the bank was providing financial services to numerous organizations linked to Islamist groups.
Among its account holders are groups linked to the Muslim Brotherhood, a charity banned in the US as a terrorist entity, groups that promote hard-line preachers, and a mosque whose trustee is a Hamas leader.
The bank’s annual report filed in May said Al Rayan’s “anti-money laundering (AML) processes and controls have been placed under formal review by the Financial Conduct Authority, which has led to ongoing investment in enhanced AML processes.”
The FCA restrictions mean the bank must not accept or process any new deposit account applications from a “person categorized as high risk for the purposes of financial crime risk” and “politically exposed persons” or their families and close associates.
Al Rayan, headquartered in Birmingham in central England, is the UK’s largest and oldest Islamic bank. It is 70 percent by Qatar’s Masraf Al Rayan and 30 percent by Qatar Holding.
The FCA says banks are required to “apply risk-based customer due diligence” to prevent their services “being used for money laundering or terrorist financing.”
Pressure on the Al Rayan comes as Qatar continues to be accused of supporting Islamist groups like the Muslim Brotherhood. Doha’s alleged funding of extremists in the Middle East was central to the decision by Saudi Arabia and other Arab countries to launch a boycott of the tiny emirate in 2017.
A spokesperson for Al Rayan said it “voluntarily agreed to place a temporary restriction on new deposit accounts for individuals classified as ‘high risk’ or ‘politically exposed’,” following discussions with the FCA. The bank “is committed to ensuring that our risk management policies and practices remain appropriate for a bank of our size and complexity.”