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- Latham & Watkins Chair Bill Voge Resigns Over Sexual Messages
- Jefferies Equity Trading Slips Even as Volatility Increases
- Can Jes Staley Fix Barclays Fast Enough?
- Deutsche Bank Slides 6.2% After Warning of $550Mn Q1 Headwind
- UBS to Pay $230Mn to N.Y. in Mortgage Securities Probe
- With At Least 190 Cryptocurrency Exchanges, Here's How to Pick Right One
- Mark Zuckerberg Lost $9Bn in Wealth Over Past 48 Hours
- Keynote Address, ICI 2018 Mutual Funds & Investment Management Conference
- SEC Announces Largest-Ever Whistleblower Awards
- From a $126Mn Bonus to Jail: Fall of a Star Trader
- Barclays Shares Surge as Activist Takes 5.2% Stake
- Standard Chartered Puts Compliance Head Neil Barry on Leave
- Goldman Sachs Pays Women in U.K. 56% Less Than Male Colleagues
- Deutsche Bank Leads Bulls with Higher Trading Revenue Forecast
- SocGen Cuts Traders' Bonus Pool by a Quarter
- Point72's Haynes Resigns as Cohen Seeks a New Type of Leader
- Steve Eisman, Who Called the 'Big Short' During Financial Crisis, Sleeping Easy Now
- Bitcoin's ‘Death Cross’ Looms as Strategist Eyes $2,800 Level - From Current Price of $8,120
- U.K. Brokerage Firm, Investment Manager, CEO Manipulated Trading in U.S. Microcap Stocks - SEC
- Billionaire Investor John Paulson's Hedge Fund Is 'Rightsizing', And a Bunch of Senior Staff are Leaving
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NEWSLETTERS & ALERTS
AML Deficiencies Will Cost US Bank $613 Million
US Bank as agreed to pay over $613 million in fines to settle Federal charges that it had poor anti-money laundering controls in place. The pot will be split among several federal agencies: $453Mn to the U.S. Treasury; $70Mn to FinCEN (Financial Crimes Enforcement Network); $15Mn to the Federal Reserve; and, $75Mn to the OCC (Office of the Comptroller of the Currency).
Regulators say the Minneapolis-based bank – and 5th largest bank in the country – willfully violated the Bank Secrecy Act, failing to report suspicious activities. For 5 years, beginning in 2009, the bank didn’t set up or maintain adequate AML systems. The staff dedicated to this area was stretched thin, causing the bank to miss ‘substantial’ numbers of suspicious transactions. Bank staff then tried to hide these limitations from OCC examiners.
In one particular example, US Bank’s AML personnel failed to file Suspicious Aactivity Reports, or SARs, on a customer named Scott Tucker, who used several accounts to launder ill-gotten proceeds from a fraudulent payday lending scheme. In fact, the bank didn’t file an SAR on Tucker until 2013, when it received a subpoena from the U.S. attorney in Manhattan - even though bank personnel knew that the FTC had filed a suit against Tucker. In 2017, Tucker was convicted in federal court and sentenced to more than 16 years in prison.
US BANK INCURS RELATIVELY LIGHT SANCTIONS. As the NYTimes notes, the sanctions against US Bank were modest compared with cases against HSBC and Standard Chartered. While US Bank’s issues focused mainly on its failure to detect and report suspicious activities, the other banks were found to have done business with drug gangs and countries like Cuba and Iran that had been under international sanctions.
Given the fact that US Bank’s settlement includes a so-called deferred prosecution agreement, the bank’s AML programs will be subject to monitoring by federal authorities for at least the next 2 years - though the bank has already started to upgrade its AML practices by hiring staff, upgrading systems and installing a new leadership team.