U.S. Bancorp Enters Into Consent Order in Anti-Money-Laundering Case
November 05 2015 - 10:53AM
Dow Jones News
By Rachel Louise Ensign
U.S. Bancorp said it entered into a consent order last month
with the Office of the Comptroller of the Currency over alleged
anti-money-laundering deficiencies.
The Minneapolis-based bank said in a securities filing Wednesday
that it entered into the order with the regulator Oct. 23 that
involved "deficiencies in its Bank Secrecy Act/anti-money
laundering compliance program" and requires an ongoing review of
that program.
Under such orders, the regulator typically alleges that a bank
has inadequate controls to keep out dirty money and the bank agrees
to take steps to bolster such controls. In similar agreements,
other banks did not admit or deny the regulator's allegations.
Anti-money-laundering laws require banks to have a system to
detect and prevent money laundering. These laws have been enforced
more strongly in the last five years and a number of major fines
for deficiencies at big banks have led other lenders to focus on
anti-money-laundering compliance.
"U.S. Bank embraces the highest standards of compliance and we
continuously explore ways to improve our processes across the
enterprise to benefit all of our customers," a bank spokesman said.
"We will continue to work closely with the OCC to resolve their
concerns as expeditiously as possible."
U.S. Bank's disclosure comes after the lender has said it is
bolstering spending on compliance. In the third quarter, the bank
said noninterest expense rose more than 6% from the year prior in
part due to higher staffing for risk and compliance activities. The
bank said in its filing that it has already made some of the
compliance enhancements required by the consent order.
"We have gone from baggage handlers to pilots," U.S. Bank Chief
Executive Richard Davis said on the earnings call, referring to the
regulators' heightened compliance expectations of bank employees.
"Baggage handlers, every once in a while, make a mistake. And up
until now, it's okay; no one loses their life, but pilots in the
same company can't crash a plane."
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(END) Dow Jones Newswires
November 05, 2015 10:38 ET (15:38 GMT)
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