Costco has been fined £1.4 billion by the Financial Conduct Authority (FCA) over the way it failed to properly disclose and disclose payments to insurance companies and investors.
The £1,928,749 fine was the largest ever for a bank in the UK, and follows an investigation by the Serious Fraud Office into the handling of the bank’s mortgage products.
The company has been criticised for failing to provide details on what types of properties it sold, the amount of its mortgage products and the terms of its insurance contracts.
In addition, it was found that it made inaccurate statements about the size and shape of its mortgages and how many people it sold.
It also failed to disclose how much money was paid for the loans, and how much of that money was for mortgage payments.
The FCA has ordered the company to pay a total of £1 billion in penalties, and to stop making misleading mortgage products, for a period of up to two years.
Costco has paid a total fine of £931 million, according to data from the Financial Services Authority.
The investigation by FCA was prompted by the collapse of a company called Realtor.com, which collapsed in December 2014.
In its investigation, the FCA found that Realtors, which were supposed to be self-regulating, failed to report payments for all mortgage products on their website.
A separate investigation found that other banks, including the US-based Wells Fargo, were similarly failing to properly track the costs of their mortgages.
Costco said that the new rules would help it meet the FFA’s requirements, and improve its compliance with the rules.
The bank said it was “pleased” with the decision.
“Costco will continue to work with regulators and the FSA to improve our risk management practices and strengthen our compliance controls, and we will continue taking appropriate action in the coming months,” a spokeswoman said.
“We are committed to improving our mortgage product offerings and will continue working with regulators to achieve these objectives.”
The FFA said it had “found no evidence of the type of deceptive conduct identified in the Serious Crime Commission report”.
“We will continue investigating this matter and are prepared to consider any additional evidence of any wrongdoing,” it said.