HSBC bank has been fined just under £64million for failings in its anti-money laundering processes, the Financial Conduct Authority has said.
The regulator said the lender used automated processes to monitor hundreds of millions of transactions a month to identify possible financial crime.
However, three key parts of HSBC’s transaction monitoring systems showed serious weaknesses over a period of eight years from 31 March 2010 to 31 March 2018.
It said HSBC's measures failed to consider all relevant risks until 2014 and did not carry out timely risk assessments for new suspicious transactions until after 2016.
This included failing to appropriately test and update the parameters within the systems that were used to determine whether a transaction was indicative of potentially suspicious activity.
HSBC did not dispute the FCA’s findings and agreed to settle at the earliest possible opportunity, which meant it qualified for a 30% discount - amounting to a total fine of £63,946,800
Otherwise, the FCA would have imposed a financial penalty of £91,352,600.
Mark Steward, executive director of Enforcement and Market Oversight at the FCA, said: "HSBC’s transaction monitoring systems were not effective for a prolonged period despite the issue being highlighted on numerous occasions.
"These failings are unacceptable and exposed the bank and community to avoidable risks, especially as the remediation took such a long time.
"HSBC continued their remediation to address these weaknesses after the relevant period.”
It marked the first time a financial institution had faced criminal prosecution by the FCA under anti-money laundering laws in the UK.
Bradford jeweller Fowler Oldfield deposited £365million with the bank - with the court hearing how £264million in cash was brought into a branch in bin bags.
NatWest, part of the Royal Bank of Scotland group, in October pleaded guilty to three offences under the Money Laundering Regulations 2007, between November 8 2012 and June 23 2016.
"Throughout the indictment period it is accepted NatWest sought to discharge its obligations under the regulations and that it failed to do so," judge, Mrs Justice Cockerill said.
"It is not suggested there has been any deliberate flouting of the rules or any criminal intent."
The judge added: "Although in no way complicit in the money laundering which took place... without the bank's failings the money could not have been laundered."
Around 50 branches across the country were used to make deposits, with Southall receiving £42 million in cash between January 2015 to March 2016 but no report was made that it was suspicious.
The court heard some £700,000 was paid into the Walsall branch in a single day, with the cash brought through a shopping centre in bin bags.
"Somebody was walking through the streets with the black bin liners of cash," said Ms Montgomery.
The cash was too heavy for the bags and had to be repackaged in hessian sacks but there was so much it could not all be stored in the bank's safes, she added.
NatWest's Halifax branch received £750,000 in three days, while Piccadilly and New Bond Street, which had "several millions" in deposits, were concerned it was more cash than they could deal with.
An outgoing manager of another cash centre said the activity was "the most suspicious money laundering" he had ever seen but the financial crime manager took the view there were "macroeconomic reasons" for the spike in cash deposits.
NatWest chief executive officer Alison Rose said: "NatWest takes its responsibility to prevent and detect financial crime extremely seriously.
"We deeply regret that we failed to adequately monitor one of our customers between 2012 and 2016 for the purpose of preventing money laundering.
"While today's hearing brings an end to this case, we will continue to invest significant resources in the ongoing fight against financial crime."
