OCC completes BSA exam of Tokyo bank’s federal branches, sets new cease-and-desist order

Violations of the Bank Secrecy Act (BSA) and related rules are continuing to be addressed by three federal branches of MUFG Bank Ltd., Tokyo, Japan, under a consent cease-and-desist (C&D) order executed Thursday with the Office of the Comptroller of the Currency (OCC), according to the order released Friday by OCC.

MUFG bank (identified in a previous order as The Bank of Tokyo-Mitsubishi UFJ, Ltd.) has three branches in New York, Chicago, and Los Angeles that received provisional approval to convert to federally supervised branches in November 2017. At the same time, they entered into a consent order with the OCC to address Office of Foreign Assets Control (OFAC) program deficiencies and U.S. economic sanctions concerns raised in 2013 and 2014 consent orders with the New York Department of Financial Services (which also assessed a civil money penalty against the New York branch).

Thursday’s order cites additional issues not previously identified by the New York supervisor.

One of the conditions of the 2017 order with OCC was that the federal regulator would complete a “full-scope” examination of BSA/anti-money laundering compliance by the three branches. This examination, the OCC said Friday, identified BSA compliance program deficiencies dating back to June 2016. “The examination identified deficiencies in the branches’ internal controls, suspicious activity monitoring, foreign correspondent due diligence program, trade finance monitoring, independent audit, and BSA officer staffing functions,” the agency said. “These findings cited violation of the statutory and regulatory requirements to maintain an adequate BSA compliance program, file suspicious activity reports, and conduct appropriate due diligence on foreign correspondent accounts.”

OCC says the order “requires the branches to take comprehensive corrective actions to improve their BSA/AML compliance program. The branches continue to operate under an OCC consent order, issued in November 2017, requiring corrective actions to improve OFAC compliance program.”

It adds, “The branches have begun corrective actions and are committed to remedying the deficiencies identified by the OCC and enhancing the branches’ BSA/AML compliance program.”

OCC Issues Cease and Desist Order Against MUFG Bank, Ltd., for Violating the Bank Secrecy Act

Cease and Desist Consent Order

November 2017 Order