OCC issues a cease-and-desist letter to Bank of America for anti-money laundering violations

The Office of the Comptroller of the Currency issued a cease-and-desist notice on Monday command against Bank of America for deficiencies in its sanctions programs and failure to comply with the Bank Secrecy Act.

Following the order, BofA must revise its anti-money laundering protocol, hire an outside consultant to assess compliance with the BSA and sanctions, and undergo a review of the company’s past actions to confirm any suspicious activity were properly reported. The order did not impose a fine on the bank.

“The OCC took this action due to violations and unsafe or unreliable practices associated with these programs, including failure to timely file suspicious activity reports and correct a previously identified deficiency related to its customer due diligence processes,” said release the agency in one. “The order also identifies deficiencies in the bank’s internal controls, governance, independent testing and training components of its BSA compliance program.”

The OCC’s order painted a picture of a bank that only partially monitored its large customer base. OCC found significant compliance violations at Bank of America, including inadequate internal controls, poor governance and deficient independent testing, which the agency said led to systemic failures in transaction monitoring and suspicious activity reporting.

The bank also failed to address weaknesses in customer due diligence processes and lacked adequate oversight, training and sanctions compliance verification.

The bank knew this was coming. Bank of America disclosed In October, the company disclosed discussions with regulators about deficiencies in its anti-money laundering and sanctions compliance programs.

At that time, the bank identified problems in transaction monitoring, governance, training and customer due diligence. BofA warned of possible enforcement action but suggested the significant financial impact would be limited and said it had already begun implementing program improvements. Analysts pointed to possible cost increases and the possibility of growth restrictions similar to the penalties Wells Fargo faces.

A spokesman for the bank said that the measure could more accurately be described as a “consent order” due to the bank’s alleged cooperation with the agency, noting that the bank is already complying with it.

“We have worked closely with the Office of the Comptroller of the Currency over the past year to make improvements to our anti-money laundering and sanctions programs,” the spokesman said. “The work we have done to date puts us in a position to implement the requirements of the consent order.”

The latest enforcement action against Bank of America mirrors previous regulatory actions against other OCC-regulated companies over anti-money laundering deficiencies, as major banks tightened controls this year, particularly with respect to anti-money laundering compliance. Wells Fargo was in front of the supervision Restrictions in September due to failures in training and transaction monitoring. The OCC subsequently issued an enforcement order, imposed a fine, and required Wells Fargo to improve these systems and temporarily obtain OCC approval before entering high-risk markets or products.

TD Bank has faced historic anti-money laundering violations Punish in October after the government accused her of facilitating money laundering related to drug trafficking. Regulators have imposed an asset cap on TD’s U.S. retail business, restricting growth until compliance improves. The problems contributed to the collapse of TD’s $13.4 billion merger with First Horizon Bank. The penalties also prompted TD to rethink its U.S. strategy and exit certain business segments to meet regulatory requirements.

Unlike TD, Bank of America’s agreement with the OCC contained no mention of asset caps or growth restrictions.