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Amid Big Sanctions Cases, AML Actions Fell by a Third in First Half of 2012
By Brian Monroe and Colby Adams
printThe number of federal anti-money laundering enforcement actions issued in the first half of 2012 fell by 35 percent in comparison to the total levied during the same period last year, data shows. The chief bank regulators-the Federal Deposit Insurance Corp. (FDIC), Federal Reserve and Office of the Comptroller of the Currency (OCC)-as well as the Financial Crimes Enforcement Network (FinCEN) handed down a total of 24 anti-money laundering (AML) orders and penalties from January 2012 through the end of June. That number compares to 37 issued in the first six months of 2011. Bank Secrecy Act-related monetary penalties also...
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Sometimes a decline in bank enforcement actions isn't a good thing, even for bankers. Such is the takeaway of a review of enforcement action data spanning back five years, during which the number of formal Bank Secrecy Act penalties fell nearly 20 percent while fines and regulatory demands grew.
In the messy art of prognostication, everything is overly easy and nothing exact, not even compliance expectations. But one thing government officials and financial industry representatives seem certain of: 2015 will prove just as challenging as the past year for AML professionals.
In a year when the number of enforcement actions issued by federal financial regulators fell by nearly half, Bank Secrecy Act-related penalties earned an unusual distinction. They declined by less than 14 percent.
With plenty of convincing reasons, representatives of the law enforcement and compliance industry say the coming year is fraught with serious challenges.
An IRS initiative granting state and municipal investigators access to a federal database of bank regulatory filings has helped law enforcement agencies reap hundreds of millions of dollars in forfeitures.
Fines and monetary settlements paid in 2012 by banks for anti-money laundering and counterterrorism financing violations increased 131-fold from the previous year, ACAMS moneylaundering.com data shows.
Though none can predict the future, one thing in the AML world seems certain: the jobs of compliance officers won't get any easier in 2013.
For many anti-money laundering and sanctions professionals, 2012 will be remembered as a year of record fines. Banks paid billions to settle AML and sanctions compliance violations, with one penalty alone reaching almost $2 billion.
After a busy year for federal sanctions officials, large banks with international footprints are increasingly instituting deeper, standalone audits of their related policies and procedures, say compliance officers and consultants.
The total number of anti-money laundering enforcement fines handed down by federal regulators rose by 67 percent in 2011 compared to the previous year.
Law enforcement data requests and Bank Secrecy Act regulatory filings rose for the U.S. Treasury Departments financial intelligence unit in the last fiscal year, according to an annual report released Thursday.
Tax investigations, political turmoil and economic sanctions were among the biggest challenges faced by the compliance departments of financial institutions in 2011, say bank officials and industry experts.
The number of anti-money laundering enforcement actions handed down by federal banking regulators rose nearly 48 percent in the first six months of 2011 compared to the same period last year, data shows.
Federal banking regulators are increasingly relying on informal actions to pressure banks to improve their anti-money laundering programs out of the public spotlight, say compliance professionals.
The number of annual federal banking fines for anti-money laundering violations rose by nearly fourfold in 2010, while the total dollar amount of the monetary penalties rose to over $660 million, according to Moneylaundering.com/ComplianceAdvantage data.
The overall number of regulatory enforcement actions against banks jumped 52 percent in the first half of 2010 in comparison to the number issued in the first half of 2009.
The total regulatory fines issued by the United States against financial institutions for anti-money laundering compliance problems fell by 90 percent in 2009 from the total levied in 2008, according to ComplianceAdvantage.com data.
Banking regulators issued 23 enforcement actions in the first half of 2009, slightly more than for the same period in 2008, according to Inform data.
Federal regulators are not giving banks any free passes when it comes to anti-money laundering compliance despite a flurry of loan-related enforcement actions, according to an analysis of recent penalty orders.