By 
The Bank of England has imposed a landmark fine on Vocalink, a Mastercard-owned company and operator of the UK’s core payments infrastructure, over its failure to fully comply with a regulatory directive aimed at improving its systems and controls.
This marks the first time the Bank has levied a penalty against a systemically important financial market infrastructure (FMI) firm.
In a statement released this week, the Bank said that Vocalink did not meet the February 2022 deadline set for the remediation of significant weaknesses identified in its risk management framework, governance structure, and control processes. The Bank cited deficiencies in escalation procedures and internal oversight, which collectively hindered full compliance.
Sarah Breeden, Deputy Governor for Financial Stability, noted:
“Vocalink fell short of its obligation to maintain adequate risk management and governance arrangements in line with our Direction. Its failure to comply fully has resulted in a significant fine.”
Vocalink plays a critical role in the UK’s financial ecosystem, facilitating over 90% of salary payments, 70% of household bills, and 98% of state benefits, in addition to operating a network of 47,000+ ATMs and managing real-time payments, direct debits, and settlement services.
In recognition of its cooperation and decision to resolve the matter promptly, the Bank applied a combined 45% discount to the penalty. Without this reduction, the fine would have totaled £20 million.
In a statement, a Vocalink spokesperson acknowledged the issues, which were initially flagged in 2020, and stressed that they did not impact the company’s operational performance or service delivery:
“We are pleased to bring closure to this matter, which involved historical issues related to internal systems and controls. Since then, we have implemented numerous improvements, as acknowledged by the Bank in its final notice. Importantly, there was no disruption to the services provided to UK consumers and businesses.”
The Bank’s action underscores its increased scrutiny of financial infrastructure providers and its commitment to ensuring resilience and sound governance within the UK’s critical payments landscape.
Comments