Mastercard’s Vocalink fined by BOE over compliance lapses

Mastercard’s (NYSE:MA) Vocalink network has been fined £11.9M ($16.2M) by the Bank of England after a string of oversight failures, marking the first time the U.K. central bank has financially punished a financial market infrastructure firm, according to a Wednesday release.

Vocalink was directed by the BOE to remediate a number of identified systems and controls issues by Feb. 28, 2022. But it failed to fully comply with the requirements by the deadline, the central bank said, citing Vocalink’s “ineffective risk management framework, combined with weaknesses in its controls, governance arrangements and escalation processes.”

“Vocalink fell short of its obligation to have adequate risk management and governance arrangements when responding to the Bank’s Direction,” said Sarah Breeden, the BOE’s deputy governor for Financial Stability. “Its failure to comply with that Direction in full has resulted in a significant fine.”

The network, which was acquired by Mastercard (NYSE:MA) nearly a decade ago, has been regulated by the BOE since 2018 as a specified service provider, a type of financial market infrastructure firm involved in the operation of UK payments systems.

Because Vocalink cooperated during the probe and opted to settle the case early, the BOE reduced its original £20M penalty by 45%, bringing the final fine down to £11.9M.