Data deficiencies were a contributing factor to 68% of FCA enforcement cases for anti-money laundering (AML) non-compliance between 2020 and 2025, a new report from Kyckr, provider of global company registry data, reveals.
The report analysed AML failings in UK financial institutions and examines 22 FCA Final Notices totalling over £430 million in fines.
It reveals four main categories of data failure, all of which highlight a consistent pattern and the root causes of information gaps:
• Outdated and missing information - a contributing factor to 45% of fines. This included a reliance on outdated Politically Exposed Persons (PEPs) and investor lists and not collecting sufficient information on customers to contextualise transactions.
• Failure to identify the ultimate beneficial owner (UBO) of a given entity – a contributing factor to 32% of fines. This included not knowing who ultimately controls an entity – and building an ownership map from that – which enables financial crime professionals to “build the story” of an entity into a bigger picture.
• Weak verification of wealth and funds – a contributing factor to 32% of fines. This included not knowing how much money a business has at its disposal, without which firms cannot contextualise customer transactions.
• Discrepancies between customer declarations and the public record – a contributing factor to 18% of fines. This included failure to detect mismatches between “what a customer says about themself” and “what the public record shows”.
The findings of the report highlight how the FCA is no longer satisfied with the policies firms have ‘on paper’. In AML compliance and the fight against financial crime, enforcement action now focuses on whether institutions can obtain, verify and continuously update accurate customer information in practice.
Steve Lamb, CEO at Kyckr, commented: “The problem firms face is that they are relying on outdated or incomplete data retrieved from siloed workflows. If poor data quality is a major contributor to AML fines, the solution isn’t more staff or bigger frameworks: it’s direct and ongoing access to authoritative company data.
“These findings show that policy alone isn’t enough and that data quality now plays a significant role in AML effectiveness. Financial institutions must be able to prove that their customer information is both accurate and verified in real time.”
