U.S. Bancorp Charged Over Relationship With Race-Car Driver Scott Tucker

By Christina Rexrode

U.S. Bancorp, the biggest regional bank in the country, was fined $613 million Thursday for what regulators and prosecutors said were shoddy anti-money-laundering controls.

The U.S. attorney's office in Manhattan also announced criminal charges against the bank that would be deferred for two years under a prosecution agreement. The U.S. Attorney, Geoffrey Berman, said the bank's poor controls had allowed a former customer, race-car driver Scott Tucker, to launder money from an illegal payday-lending scheme. Mr. Tucker was convicted of fraud last year.

Prosecutors said in a statement that U.S. Bank had operated the program "on the cheap" and then imposed caps on the number of transactions that could be subject to anti-money-laundering review.

The agreement with prosecutors included a so-called deferred prosecution agreement, under which the bank must continue to improve its anti-money-laundering program. In exchange, the government could in two years seek to dismiss the charges. The Justice Department agreement also required the bank to agree to a statement of facts about its conduct.

The bank also announced settlements or agreements with the Federal Reserve, the Office of the Comptroller of the Currency and the Financial Crimes Enforcement Network.

The bank's chief executive, Andy Cecere, said in a statement that "We regret and have accepted responsibility for the past deficiencies in our" anti-money-laundering program. The bank also said it had installed a new leadership team over anti-money-laundering programs and taken other steps, including improved training.

Write to Christina Rexrode at christina.rexrode@wsj.com

(END) Dow Jones Newswires

February 15, 2018 11:16 ET (16:16 GMT)

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