The Bank of England has imposed a fine of £11.9m against Vocalink for failing to comply with a regulatory direction to address systems and controls issues.
This marks the first instance of the Bank of England penalising a financial market infrastructure firm.
Go deeper with GlobalData
In 2021, the central bank directed Vocalink to address identified weaknesses in its systems and controls through a remediation programme, with a deadline of 28 February 2022.
However, the Mastercard-owned company failed to fully comply due to an ineffective risk management framework, coupled with deficiencies in its controls, governance, and escalation processes, the regulator said.
BoE deputy governor for financial stability Sarah Breeden said: “Vocalink fell short of its obligation to have adequate risk management and governance arrangements when responding to the Bank’s Direction. Its failure to comply with that Direction in full has resulted in a significant fine.”
The investigation pinpointed a lack of a sufficiently integrated risk management framework as the root cause of Vocalink’s non-compliance.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataThis flaw hindered the ability to properly understand, monitor, and communicate risks associated with the remediation programme.
Furthermore, the bank identified failures in escalating key risks and information to senior committees, which compromised Vocalink’s capacity to meet the regulatory expectations.
In response to the investigation’s findings, Vocalink has undertaken significant investments to address the issues that prompted the issuance of the direction and the subsequent non-compliance.
In a statement, Vocalink spokesperson said: “We are pleased to resolve this matter which related to issues identified in 2020. Since then, we’ve delivered a number of improvements.
“The historic issues related to internal systems and controls and had no impact on the service we delivered to UK consumers and businesses.”
Vocalink is a UK-based company that designs, builds, and operates infrastructure for payment systems.
Its technology is integral to the functioning of the UK’s real-time payment, batch payment, and cheque image clearing services, as well as a vast network of ATMs across the country.
