Printer Friendly
The Free Library
23,396,934 articles and books


Enforcement actions.

Written Agreements

The Federal Reserve Board on August 2, 2004, announced the execution of a written agreement by and among the Traders Bank, A Banking Corporation, Spencer, West Virginia; the West Virginia Division of Banking, Charleston, West Virginia; and the Federal Reserve Bank of Richmond.

The Federal Reserve Board and the New York State Banking Department on October 8, 2004, announced the execution of a written agreement by and among Standard Chartered, plc, London, United Kingdom; its subsidiary bank, Standard Chartered Bank, London, United Kingdom; the bank's New York branch; the Federal Reserve Bank of New York; and the New York State Banking Department.

The written agreement addresses Bank Secrecy Act and anti-money-laundering compliance at Standard Chartered Bank's New York branch, including policies and practices relating to the provision of correspondent banking services.

The Federal Reserve Board on October 19, 2004, announced the execution of a written agreement by and between the Union Bank of California International, New York, New York, and the Federal Reserve Bank of New York.

The written agreement addresses Bank Secrecy Act and anti-money-laundering compliance at the Union Bank of California International, including policies and practices relating to the provision of correspondent banking services.

The Federal Reserve Board on October 21, 2004, announced the execution of a written agreement by and among The Community State Bank, Poteau, Oklahoma; the Oklahoma State Banking Department, Oklahoma City, Oklahoma; and the Federal Reserve Bank of Kansas City.

The Federal Reserve Board on October 29, 2004, announced the execution of a written agreement by and between the County Bank, Merced, California, and the Federal Reserve Bank of San Francisco.

Other Actions

The Federal Reserve Board on August 24, 2004, announced the issuance of a consent notice of prohibition against Charles Kushner, an institution-affiliated party of The NorCrown Trust, an unregistered bank holding company that owns or controls the shares of the NorCrown Bank, Livingston, New Jersey, a state nonmember bank.

A notice of prohibition is issued under a provision of the Federal Deposit Insurance Act that authorizes the Federal Reserve and other bank regulators to limit the activities of bank officials who have been charged with criminal offenses pending the resolution of the charges.

The Board's action against Mr. Kushner has been coordinated with the U.S. Attorney's Office for the District of New Jersey.

The Federal Reserve Board on August 24, 2004, announced the issuance of a consent notice of prohibition against Kenneth M. Matzdorff, the majority shareholder and a former officer and director of Garden City Bancshares, Inc., Garden City, Missouri, a registered bank holding company that owns or controls the Garden City Bank, Garden City, Missouri, a state nonmember bank.

A notice of prohibition is issued under a provision of the Federal Deposit Insurance Act that authorizes the Federal Reserve and other bank regulators to limit the activities of bank officials who have been charged with criminal offenses pending the resolution of the charges.

The Board's action against Mr. Matzdorff has been coordinated with the U.S. Attorney's Office for the Eastern District of New York.

The Financial Crimes Enforcement Network (FinCEN) and the Board of Governors of the Federal Reserve System announced on October 12, 2004, that they have jointly assessed a $10 million civil money penalty against AmSouth Bank of Birmingham, Alabama, for its violations of the Bank Secrecy Act.

In addition, the Federal Reserve Board and the Alabama Superintendent of Banks concurrently issued a cease and desist order requiring AmSouth Bank and its parent bank holding company, AmSouth Bancorporation, to take certain corrective actions. AmSouth, without admitting or denying any allegations, consented to the payment of the civil money penalty and issuance of the orders by FinCEN, the Board, and the state.

FinCEN and the Federal Reserve Board based their assessment on the failure of the banking organization to establish an adequate anti-money-laundering program and the failure to file accurate, complete, and timely Suspicious Activity Reports (SARs). The agencies found systemic defects in AmSouth's program with respect to internal controls, employee training, and independent review that resulted in failures to identify, analyze, and report suspicious activity occurring at the bank.

William D. Langford, Jr., associate director of FinCEN's Regulatory Policy and Programs Division, stated, "Comprehensive Bank Secrecy Act compliance programs that enable financial institutions to identify and report suspicious activities are the foundation of our efforts to combat money laundering and protect our financial system. As this case reflects, if a financial institution fails to establish and implement effectively such programs, we will take appropriate action to ensure compliance."

The orders are part of coordinated actions with the Office of the U.S. Attorney for the Southern District of Mississippi and the Internal Revenue Service, Criminal Investigation, who also announced on October 12, 2004, the execution of a deferred prosecution agreement with AmSouth in connection with charges that the bank violated the Bank Secrecy Act relating to the filing of inaccurate, incomplete, or late SARs. The Federal Reserve Board and FinCEN provided assistance to, and cooperation with, law enforcement authorities during the course of their investigation.

"These actions demonstrate how coordination among the agencies responsible for enforcement of the Bank Secrecy Act can address the effectiveness of banks' anti-money-laundering programs and internal compliance reviews," said Herbert A. Biern, senior associate director of the Board's Division of Banking Supervision and Regulation.

The cease and desist order issued by the Federal Reserve Board requires improvements in the banking organization's Bank Secrecy Act compliance and suspicious activity monitoring and reporting programs, a review of previous transactions to ensure that all SARs have been filed, as required, and enhancements to internal controls and management oversight.
COPYRIGHT 2004 Board of Governors of the Federal Reserve System
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2004, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

 Reader Opinion

Title:

Comment:



 

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Announcements; Federal Reserve Board
Publication:Federal Reserve Bulletin
Geographic Code:1USA
Date:Sep 22, 2004
Words:937
Previous Article:Meeting of the Consumer Advisory Council.
Next Article:Changes in board staff.
Topics:



Related Articles
Statements to the Congress.
Statements to the Congress.
Statements to the Congress.
Statement by John P. LaWare, Chairman, Federal Financial Institutions Examination Council and Member, Board of Governors of the Federal Reserve...
Statement to the Congress.
Statement by Herbert A. Biern, Deputy Associate Director, Division of Banking, Supervision and Regulation, before the Committee on Banking, Housing,...
Statement by Richard A. Small, Assistant Director, Division of Banking Supervision and Regulation, Board of Governors of the Federal Reserve System,...
Announcements.
Changes in board staff.
Enforcement actions.

Terms of use | Copyright © 2014 Farlex, Inc. | Feedback | For webmasters