The Bank of England has imposed a GBP 11 million fine on Vocalink Limited, a regulated financial market infrastructure firm.

Vocalink was overseen by the Bank of England as a specified service provider since April 2018. This classification typically involves operations in UK payments systems.

Following a non-compliance issue, Vocalink initiated a remediation program with a deadline set for February 28, 2022. However, due to an insufficient risk management framework and multiple control weaknesses, governance shortcomings, and ineffective escalation processes, the company failed to meet this requirement fully.

Details of the GBP 11 Million Fine

The Bank’s investigation highlighted that Vocalink’s non-compliance stemmed from a lack of a comprehensive and integrated risk management framework for the remediation program. This framework was meant to ensure risks could be effectively understood, monitored, shared among the three lines of defense, and externally assured.

Additionally, key risks and information were not escalated properly to senior committees, which hindered Vocalink’s ability to fully comply with the Direction. The Bank currently deems Vocalink’s governance arrangements below the expected standards for a financial market infrastructure firm.

Vocalink has invested significantly in addressing these issues, contributing to both the issuance of the Direction and subsequent non-compliance.

Moreover, Vocalink’s cooperation during the investigation, including an early acknowledgment of the compliance failure, led to a 15% reduction in the fine. The company also agreed to resolve the matter, qualifying for an additional 30% fine reduction. Without these reductions, the penalty would have been GBP 20 million.