AML deficiencies prompted C&Ds against branches of UBS AG in three states

UPDATE: Ends 2016 enforcement action against Wells for SCRA violations

Cease and desist orders against three branches of UBS AG bank in Connecticut, Florida and New York for anti-money laundering prevention deficiencies were among nearly two dozen enforcement actions in late May and June taken by the regulator of national banks and federal savings associations, the agency said Friday.

Nine terminations of existing enforcement actions were among those actions released. UPDATE: Those included a two-year-old action against Wells Fargo for failing to obtain court orders prior to repossessing servicemembers’ automobiles.

The May-June actions – released by the Office of the Comptroller of the Currency (OCC) with the consent of the parties (unless otherwise indicated as a decision and order issued by the OCC) – included cease and desist (C&D) orders against branches of the UBS AG in Stamford, Conn., Miami, Fla, and New York, N.Y. The C&Ds were issued, the OCC alleged, for the branches’ failure to file the necessary “suspicious activity reports” (SARs) concerning suspicious customer activity in a timely manner. The bank is required to adopt and successfully implement a “Bank Secrecy Act/Anti-Monday Laundering” (BSA/AML) action plan for each of the branches.
The Wells Fargo enforcement termination dealt with a 2016 consent order in which the bank’s compliance program with the Servicemembers’ Civil Relief Act (SCRA) “has exhibited deficiencies and weaknesses that contributed” to violations. The 2016 order noted that “the Bank’s conduct, as evidenced by the violations of the SCRA and compliance deficiencies” involved violations of law.

The bank had been subject, through the consent order, to a comprehensive reassessment of its SCRA compliance and reporting of its actions. Additionally, in a separate but related order in 2016, the bank agreed to pay a civil money penalty of $20 million.

In ending the enforcement action, the OCC said it “believes that the protection of the depositors, other customers, and shareholders of the Bank, as well as its safe and sound operation, does not require the continued existence of said Order,” imposed in September 2016.

In other action, the agency imposed two civil money penalties (CMPs) against former employees of Gibraltar Private Bank & Trust Co. of Coral Gables, Fla., totaling $50,000.

According to the OCC, William VanDresser, a former senior executive at the bank, was assessed a $35,000 CMP for alleged reckless unsafe or unsound practices, which the agency said “were likely to cause more than a minimal loss to the Bank, and resulted in pecuniary gain to respondent.” Additionally, Elden LeGaux, another former executive of the bank, was assessed a $15,000 CMP for alleged reckless unsafe or unsound practices.

Other enforcement actions announced by the agency include:

  • CMPs totaling $30,000 against three former employees of an Oklahoma bank for alleged unsafe, unsound practices related to securities issued on behalf of corporate borrowers. Cyndi Sue Wilkinson, a former senior vice president of BOKF, N.A., in Tulsa was assessed a $25,000 CMP; she was also prohibited from future service at a federally insured financial institution without prior approval by the agency. Two other former bank vice presidents — Mary Patricia Campbell and Terri Lynn Pulley – were assessed CMPs of $2,500 each and agreed to cease and desist orders.
  • C&Ds against the board chairman and board member of High Desert Bank of Bend, Oregon, for allegedly engaging in unsafe or unsound practices. Alexander Hamilton is the bank’s board chairman; Russell Schaub is a member of the board.
  • Removal and prohibition against Yeselin Sanchez, former lead teller at Capital One bank of McLean, Va., for alleged unauthorized withdrawals from two bank customers’ accounts, totaling $13,880; she agreed to repay.

The other terminations of existing enforcement actions released are:

  • C&D against EH National Bank, Beverly Hills, Calif.
  • Formal agreement (FA) with The First National Bank of Beloit, Beloit, Kansas.
  • FA with UBS AG, New York.
  • C&D against Citizens Bank, National Association, Providence, R.I.
  • C&D against Citibank, National Association, Sioux Falls, S.D.
  • C&D against First Tennessee Bank National Association, Memphis.
  • Two C&Ds against HSBC Bank USA, National Association, Mclean, Va.

OCC Enforcement Actions and Terminations for July 2018