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Bank of America (BofA) must submit an action plan detailing how it intends to remedy alleged anti-money laundering (AML) and sanctions compliance failures, following a cease and desist order.
In December, the US Office of the Controller of the Currency (OCC) issued a cease and desist order in response to BofA’s “unsafe and unsound” practices relating to AML and sanctions compliance.
The order alleges that BofA has failed to file timely suspicious activity reports (SARs) and failed to correct previously identified deficiencies in its customer due diligence (CDD) processes.
BofA neither admits or denies the allegations, but will be required to take “comprehensive corrective actions” to enhance its AML and sanctions compliance programmes.
This will include the hiring of an independent consultant to assess these programmes and to conduct lookback reviews to ensure that all suspicious activity was appropriately reported.
Bank Secrecy Act failures
The alleged failures centre on deficiencies in BofA’s compliance with the Bank Secrecy Act (BSA), the foundational law of the US AML framework.
The OCC claims that BofA failed to develop a programme to monitor its compliance with the BSA. It also identified deficiencies in the bank’s BSA officer.
“The Bank had a breakdown in its policies, procedures and processes to identify, evaluate and report suspicious activity,” said the OCC.
“This included a systemic failure to ensure that its transaction monitoring system had appropriate thresholds for determining when transaction alerts should trigger a case investigation.”
Within 30 days of the date of the order, BofA must appoint a compliance committee of at least three members, of which a majority must be directors who are not employees or officers of BofA.
The compliance committee, which will meet at least quarterly and maintain minutes of its meetings, will monitor and oversee BofA’s compliance with the provisions of this order.
Within 90 days of the order, BofA will submit for review a written plan detailing the remedial actions necessary to achieve and sustain compliance with the BSA and all relevant sanctions laws.
