$65 million fine assessed against L.A. bank for unsafe, unsound practices in risk management

A $65 million fine has been levied against a Los Angeles bank for systemic deficiencies in the bank’s risk management and internal controls, the regulator of national banks said late Wednesday.

According to the Office of the Comptroller of the Currency (OCC), City National Bank, of Los Angeles, was found by the agency to have engaged in unsafe or unsound practices, including failure to establish effective risk management and internal controls.

“This failure also resulted in noncompliance with 12 CFR Part 30, Appendix D, ‘OCC Guidelines Establishing Heightened Standards for Certain Large Insured National Banks, Insured Federal Savings Associations, and Insured Federal Branches,’” the OCC said in a release. The bank also violated the Bank Secrecy Act (BSA) and 12 CFR Part 9 – Fiduciary Activities of National Banks, the agency said. According to the OCC, the bank has been in noncompliance since Dec. 31, 2020, which it called an unsafe or unsound practice.

City National was also served with a cease-and-desist order requiring the bank to “take broad and comprehensive corrective actions to improve its strategic plan, operational risk management, including internal controls; compliance risk management, including BSA/anti-money laundering and fair lending; strategic risk management; and investment management practices,” the OCC said.

OCC Assesses $65 Million Penalty Against City National Bank

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