Monzo created bank accounts for people claiming to live in 10 Downing Street
The digital bank has been fined £21million by the Financial Conduct Authority (FCA)for failing to enforce strict anti-financial crime measures.
The FCA investigation found that Monzo had no means to verifycustomer's addresses no matter how 'implausable' they were. One customer even gave their address as Monzo's own headquarters.
The financial watchdog had imposed a requirement preventing Monzo from opening new accounts for high-risk customers.
But between August 2020 and June 2022, they said the digital bank, which has no physical branches, repeatedly failed to comply with their terms and signed up over 34,000 high-risk customers.
Monzo claims that the hefty fine draws a line under issues resolved three years ago and 'substantial improvements' have now been made.
In their ruling, the FCA said: '[Monzo] allowed customers to provide obviously implausible UK addresses when applying for an account, such as well-known London landmarks including 'Buckingham Palace' and '10 Downing Street', and even Monzo's [own] business address.
'Monzo's decision not to verify, or otherwise monitor, customer addresses also gave rise to other issues.'
Therese Chambers, FCA joint executive director of enforcement and market oversight, said that banks were a vital line of defence in the fight against financial crime.
'[Landmark addresses] illustrates how lacking Monzo's financial crime controls were. This was compounded by its inability to properly comply with the requirement not to onboard high-risk customers.'
'They must have the systems in place to prevent the flow of ill-gotten gains into the financial system,' she said.
'Monzo fell far short of what we, and society, expect.'
Monzo's customer base has substantially increased, growing from approximately 250,000 customers in early 2017 to over 12 million by April 2025.
Group CEO of Monzo, TS Anil told Metro: 'The FCA's findings relate to a historical period that ended three years ago and draw a line under issues that have been resolved and are firmly in the past – with our learnings at the time leading to substantial improvements in our controls.
'I'm pleased the FCA recognises the significant investments we have made, as well as our ongoing commitment to managing these risks today, as we go from strength to strength as a business approaching 13 million customers.
'Financial crime is an issue that affects the entire industry – and at Monzo, we have the right team, best-in-class technology and an unwavering commitment to doing all we can to stop it in its tracks.'
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