Two Days, Two Multi-Agency BSA/AML Enforcement ActionsJuly 27, 2015
Last week, Federal banking regulators and their state regulatory counterparts issued two enforcement actions addressing Bank Secrecy Act (BSA)/anti-money laundering (AML) compliance program deficiencies.
The first action, announced Tuesday by the Board of Governors of the Federal Reserve System and joined by the New York State Department of Financial Services, is a written agreement (Agreement) with China Construction Bank Corporation and its New York branch (CCB). Notable terms of the Agreement include the requirement that CCB take measures to ensure that foreign correspondent accounts, including those of its affiliates, are subject to appropriate due diligence and engage an independent third party to conduct a suspicious activity lookback that encompasses U.S. dollar clearing transaction activity for a six-month period in 2013.
Under the terms of an action announced on Wednesday, Banamex USA (BUSA), an indirect subsidiary of Citigroup Inc., will pay a total of $140 million in civil money penalties to the Federal Deposit Insurance Corporation and the California Department of Business Oversight to resolve allegations that BUSA failed to implement an effective BSA/AML compliance program and comply with an August 2012 BSA/AML consent order by the agencies. In its press release relating to the agencies’ action, Citigroup announced that it will wind down banking operations at BUSA.