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Goldman Sachs-backed digital bank Starling hit with FCA fine

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The Starling Bank banking app on a smartphone.

Adrian Dennis | AFP via Getty Images

U.K. financial regulators hit British digital lender Starling Bank with a £29 million ($38.5 million) fine over failings related to its financial crime prevention systems.

In a statement on Wednesday, London’s Financial Conduct Authority said it had fined Starling “for financial crime failings related to its financial sanctions screening.” Starling also repeatedly breached a requirement not to open accounts for high-risk customers, the FCA said.

Starling was not immediately available for comment when contacted by CNBC.

Starling, one of the U.K.’s most popular online-only challenger banks, has been widely viewed as a potential IPO candidate in the coming year or so. The startup previously signaled plans to go public, but has moved back its expected timing from an earlier targeted an IPO as early as 2023.

The FCA said in a statement that, as Starling expanded from 43,000 customers in 2017 to 3.6 million in 2023, the bank’s measures to tackle financial crimes failed to keep pace with that growth.

The FCA began looking into financial crime controls at digital challenger banks in 2021, concerned that fintech brands’ anti-money laundering and know-your-customer compliance systems weren’t robust enough to prevent fraud, money laundering and sanctions evasion on their platforms.

After this probe was first opened, Starling agreed to stop opening new bank accounts for high-risk customers until it improved its internal controls. However, the FCA says that Starling failed to comply with this provision and opened over 54,000 accounts for 49,000 high-risk customers between September 2021 and November 2023.

In January 2023, Starling became aware that, since 2017, its automated system was only screening clients against a fraction of the full list of individuals and entities subject to financial sanctions, the FCA said, adding that the bank identified systemic issues in its sanctions framework in an internal review.

Since then, Starling has reported multiple potential breaches of financial sanctions to relevant authorities, according to the British regulator.

The FCA said that Starling has already established programs to remediate the breaches it identified and to enhance its wider financial crime control framework.

The British regulator added that its investigation into Starling completed in 14 months from opening, compared to an average of 42 months for cases closed in the calendar year 2023/24.

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10-year Treasury yield rises above 4.6% ahead of jobless claims

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Traders work at the New York Stock Exchange on Dec. 17, 2024.

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Treasury yields rose Thursday morning as investors awaited new data on jobless claims.

The yield on the 10-year Treasury jumped 4 basis points 4.627%. The 2-year Treasury traded 1 basis point higher at 4.353%.

One basis point is equal to 0.01%. Yields move inversely to prices.

Jobless claims for the week ended Dec.21 are expected to total 225,000, according to an estimate from Dow Jones. Claims for the prior week totaled 220,000.

The benchmark 10-year rate has climbed more than 40 basis points this month. The bulk of the advance came after the Federal Reserve pared down rate-cut projections, indicating only two more interest rate cuts in 2025, down from the four potential cuts penciled in during September.

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Top personal finance New Year’s resolutions for 2025

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The elevated inflation in recent years continued to wreak havoc on many Americans’ wallets in 2024, but the start of the new year provides a great opportunity to set new financial goals to get back on track.

“As we step into 2025, the country’s financial landscape calls for proactive resolutions to address rising concerns such as inflation and debt,” WalletHub analyst Chris Lupo told FOX Business. “Top financial resolutions for 2025 should be focused on smart budgeting, saving, and debt repayment.”

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Many Americans set new financial goals at the start of the New Year (iStock / iStock)

Here are some of the top financial New Year’s resolutions for 2025, according to WalletHub:

1. Make a realistic budget and stick to it

“With Americans carrying nearly $1.3 trillion in credit card debt, setting realistic budgets is a must,” Lupo said.

CREDIT CARD DEBT SURGES TO ANOTHER RECORD HIGH, NEW YORK FED DATA SHOWS

2. Save more money

Lupo says saving is also key, as many households lack emergency funds. He suggests starting small with a goal of saving two months’ take-home pay and working your way up to a year’s worth.

“Don’t forget to maximize your earnings: 5%+ APYs on online savings accounts make switching banks worthwhile,” he noted, adding that high-yield Certificates of Deposit (CDs) are also worth considering.

3. Explore ways to refinance high interest rates

High-interest debt is costly, so Lupo says to consider tools like balance transfer cards or debt consolidation loans to cut costs. 

4. Repay 25% of your credit card debt

The average American is currently carrying more than $10,000 in credit card debt, and the sooner it can be tackled, the better. WalletHub says it is important to get serious about it, but suggests it is probably best to start small by setting a goal of chipping away at a quarter of it over the course of the year.

COUPLE REVEALS HOW THEY GAINED THEIR OWN FINANCIAL INDEPENDENCE

5. Fight back against inflation

Look for ways to cut costs in everyday expenses, like shopping around for everything you buy, taking advantage of deals and coupons, turning the thermostat down, buying in bulk and cutting back until prices come down.

Grocery shopping

WalletHub suggests fighting back against high prices by shopping around and finding the best price on everyday items. (Paola Chapdelaine for The Washington Post via Getty Images / Getty Images)

WalletHub has another 10 suggestions for 2025 financial resolutions, including paying bills right after getting your paycheck, making sure you have enough insurance for a catastrophe, protecting your identity, brushing up on your financial literacy, and even looking for a better job.

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“Focus on financial literacy and healthy money habits, like paying bills immediately after payday,” Lupo said. “These steps will help make 2025 a financially healthier year.”

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