Major Bank Faces Hefty $32.4 Million Penalty for Breaching Bank Secrecy Act and Mishandling Confidential Data
The Industrial and Commercial Bank of China (ICBC), the world’s largest bank with assets exceeding $5.742 trillion, has agreed to a significant $32.4 million settlement with the Federal Reserve and the New York Department of Financial Services (DFS).
The penalty stems from ICBC’s failure to adhere to the Bank Secrecy Act and Anti-Money Laundering laws, including the neglect of reporting backdated documents and unauthorized disclosure of confidential information. The DFS revealed that, following a cease and desist order from the Federal Reserve in March 2018, ICBC’s New York branch struggled to address inadequacies in its anti-money laundering protocols. Despite repeated reviews, certain issues persisted for years. Additionally, a former relationship manager at the New York branch backdated compliance documents under instructions from a senior employee, an incident that went unreported to regulators.
Furthermore, ICBC violated New York Banking Law by disclosing confidential supervisory information to a foreign regulator without authorization in late 2021. In response to these breaches, the DFS not only imposed a substantial fine but also mandated ICBC to submit a comprehensive written plan outlining improvements in compliance policies, corporate governance, customer due diligence, and the handling of confidential supervisory information.
Clever Robot News Desk 23rd January 2024
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