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The Bank of England has issued a rare enforcement penalty against the London securities arm of Japan’s biggest bank over its failure to be frank with the regulator about US enforcement proceedings against a connected company.

Commercial bank BTMU and its sister MUFG Securities were not open with the BoE about an investigation by the New York Department of Financial Services — known as a scourge of Wall Street — that led to a $315m fine, the BoE’s Prudential Regulation Authority said on Thursday.

The DFS said the lenders pressured an outside consultant to water down findings about the banks’ dealings with sanctioned countries. But the PRA found out about it only at the moment the fine was announced, the watchdog said on Thursday.

There have only been a handful of fines from the PRA since it was set up in 2013 as misconduct is normally dealt with by the UK’s Financial Conduct Authority.

Fines for breaches of firms’ duty to be open with the FCA and PRA are even rarer. Today’s fine totals £26m.

Sam Woods, the head of the PRA, said:‎

We expect firms to be open and straightforward in their dealings with the PRA. When firms fall short of this expectation we will enforce it.

A London-based spokesman for the Japanese bank said:

BTMU and MUFG Securities EMEA have cooperated fully and openly with the PRA throughout the investigation. BTMU and MUFG Securities EMEA plc express their regret for these historic breaches. MUFG has taken decisive action to improve its information controls and intra-group communication on regulatory matters.

MUFG is committed to conducting business with the highest levels of integrity and regulatory compliance and to continuing to improve its policies and procedures.

The bank declined to comment on whether individuals had faced sanctions as a result of the failing to communicate with the FCA.

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