Germany’s Commerzbank has agreed to pay £38m ($47.5m) in fines for anti-money laundering (AML) failures over a period of five years.

The bank was fined by the UK’s Financial Conduct Authority (FCA), which warned the bank thrice to put money-laundering controls in place.

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The bank failed to fix an automated tool for monitoring money-laundering risks.

FCA said that in 2015, the bank found 40 high-risk countries and 1,110 high-risk clients missing from the tool.

Commerzbank also failed to conduct due diligence checks on 1,772 clients in London, which was due in 2017.

FCA alleged that because of an “out-of-control” system of exceptions, some clients continued to transact with the bank.

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FCA executive director of enforcement and market oversight Mark Steward said: “Commerzbank London’s failings over several years created a significant risk that financial and other crime might be undetected.”

Since Commerzbank agreed to cooperate, the fine amount imposed by the FCA was discounted by 30% from the original fine amount of £54m ($67.5m).

The fine amount, which is said to be one of the largest amounts handed by the regulator, will add to the woes of Commerzbank that registered a loss of €277m ($311.1m) in Q1 2020.

A spokeswoman for the bank said: “Commerzbank has cooperated fully with the FCA to mitigate any potential compliance risks promptly and appropriately.

“The FCA investigation relates to the time period of October 2012 to September 2017. The bank has successfully remediated and addressed the deficiencies that were the subject of the investigation.”

FCA has mandated the bank to execute a “significant remediation exercise” and hire an executive to monitor the process.