Top Story Compliance Related

The Financial Crimes Enforcement Network (FinCEN) and the U.S. Attorney's Office for the Southern District of New York announced on Thursday the settlement of claims under the Bank Secrecy Act against Thomas E. Haider, the former Chief Compliance Officer of MoneyGram International, Inc. Mr. Haider has agreed to a three-year injunction barring him from performing a compliance function for any money transmitter and has agreed to pay a $250,000 penalty. He also has admitted, acknowledged, and accepted responsibility for the following, among other things: (1) failing to terminate specific MoneyGram outlets after being presented with information that strongly indicated that the outlets were complicit in consumer fraud schemes; (2) failing to implement a policy for terminating outlets that posed a high risk of fraud; and (3) structuring MoneyGram’s anti-money laundering (AML) program such that information that MoneyGram’s Fraud Department had aggregated about outlets, including the number of reports of consumer fraud that particular outlets had accumulated over specific time periods, was not generally provided to the MoneyGram analysts who were responsible for filing suspicious activity reports with FinCEN.


In December 2014, FinCEN issued a $1 million civil money penalty against Mr. Haider for failing to ensure that his company abided by the AML provisions of the BSA. [See "FinCEN assesses $1 million CMP against former compliance officer", in our Top Stories, 12/19/2014] The U.S. Attorney’s Office for the Southern District of New York then filed a complaint in U.S. District Court that sought to enforce the penalty and to permanently enjoin Mr. Haider from employment in the industry. This week's settlement concludes those actions and was approved by U.S. District Judge David S. Doty of the U.S. District Court for the District of Minnesota.

The FDIC has posted the list of 58 state nonmember banks recently evaluated for compliance with the Community Reinvestment Act (CRA) and the ratings they received. Four received an "outstanding" rating and 54 were rated "satisfactory."

The Federal Emergency Management Agency has published [82 FR 20832] in this morning's Federal Register a rule suspending, effective May 2, 2017, the Town of North Carrollton, Mississippi (Community number 280028), from the National Flood Insurance Program, for noncompliance with the floodplain management requirements of the program.

The Office of the Comptroller of the Currency announced yesterday the selection of Scott Schainost to be Deputy Comptroller for Midsize Bank Supervision and Troy Thornton to be Deputy Comptroller for the OCC’s Southern District.

The Bureau has added two new articles with advice for consumers to its Blog:

• making a decision to rent or buy a home
• taking time to consider when to claim Social Security benefits

The OCC has released a list of Community Reinvestment Act (CRA) performance evaluations that became public in April 2017. Of the 18 institutions listed this month, one is rated "outstanding," 16 are rated "satisfactory" and one is rated "needs to improve."

The White House has released the text of the remarks made by the president to the members of the Independent Community Bankers Association who visited the White House on May 1, 2017.

The FDIC has released a final handbook to assist parties interested in establishing new banks. As part of the FDIC's ongoing commitment to work with organizers, the handbook – Applying for Deposit Insurance – A Handbook for Organizers of De Novo Institutions – was designed to provide a plain-language overview of the requirements and considerations significant to the application process, and to provide organizers a clear and transparent explanation of the path to obtaining deposit insurance. The handbook offers guidance for navigating the three phases of establishing an insured institution: pre-filing activities, the application process, and pre-opening activities. It provides useful information for organizers of a new depository institution, and reflects comments from organizers and other interested parties during recent industry outreach events. The handbook does not establish new policy or guidance, or modify existing policy or guidance.

• See also FIL-17-2017

The Conference of State Bank Supervisors has filed a complaint in the U.S. District Court for the District of Columbia against the OCC and Comptroller Curry to challenge the OCC's recent decision to create a new special-purpose national bank charter for financial technology and other nonbank companies, arguing that the OCC's licensing of such companies would go "far beyond the limited authority granted to it by Congress under the National Bank Act and other federal banking laws." The CSBS also alleges in its complaint that the OCC's decision to offer these special-purpose charters was in violation of the Administrative Procedure Act. The suit seeks declaratory and injunctive relief declaring the OCC's creation of the nonbank charter to be unlawful and enjoining the OCC from pursuing it.

• CBSC complaint

The FDIC has released a list of 34 orders and one adjudicated decision for the month of March 2017. The administrative enforcement actions included five removal and prohibition orders, six Section 19 orders, two civil money penalties, four voluntary terminations of insurance; seven terminations of prior orders, and the adjudicated decision. Of note:

• A Nebraska bank was ordered to pay a $6,500 civil money penalty for violations of the Flood Disaster Protection Act and Part 339 of the FDIC's Rules and Regulations
• An individual now or formerly an institution-affiliated person of a South Dakota bank was ordered to pay $15,000 in civil money penalties for unspecified transgressions
• Orders for termination of insurance (without deposits) were approved for:
  • Republic Bank, Bountiful, Utah
  • Builders Bank, Chicago, Illinois
  • Bank of Pine Hill, Pine Hill, Alabama
  • Banamex USA, Century City, California