Staffers, director assessed penalties for failing to correct anti-money laundering issues at CA bank

Two employees and a director of a California bank have been assessed a total of $60,000 in civil money penalties for failure to enforce an order against the bank by federal authorities, the regulator of national banks said Friday.

In its April report on recent enforcement actions (one taken in February, and the remaining seven in March) the Office of the Comptroller of the Currency (OCC) said the two employees and director of Merchants Bank of California in Carson would pay the penalties; and that the two employees were subject to personal cease and desist orders. The personal C&Ds require them to undergo anti-money laundering and Bank Secrecy Act (AML/BSA) training.

The OCC said Merchants was assessed a $1 million civil money penalty in 2017 for violations of 2010 and 2014 consent orders. However, according to OCC, the employees and director failed to take necessary actions to ensure the bank corrected the deficiencies, resulting in violations of the orders.

The April enforcement report also noted:

  • Two prohibitions were ordered against Derek B. Eggert, a former personal banker at a Rochester, N.Y., branch of J.P. Morgan Chase Bank, N.A., for misappropriating bank funds from the bank vault for personal use; and against Marcus Majette, a former personal banker at Wells Fargo Bank, N.A., Sioux Falls, S.D., for misappropriating funds from a bank customer, and falsifying a loan application in the same customer’s name without the customer’s authorization or knowledge. Both are prohibited from participating in the affairs of a federally insured financial institution, unless they receive the permission of the OCC and the federal regulator of the institution.
  • A cease-and-desist order was issued against Washington Federal, N.A., of Seattle, Wash., for deficiencies in its BSA/AML compliance program. The bank agreed to take a number of actions, including: establishment of a compliance committee, appointment of a BSA officer and staff, development of a BSA/AML risk assessment program, and implementation of BSA internal controls.

OCC Enforcement Actions and Terminations for April 2018