A little blurb, hardly seen by investors
On April 5, 2012, the Office of the Comptroller of the Currency (“OCC”) issued a Cease and Desist Order against Citibank, N.A. (“Citi”).
The Order requires Citi to take comprehensive corrective actions to improve its Bank Secrecy Act (“BSA”) Compliance Program. The OCC found the following deficiencies:
•Internal controls - incomplete identification of high risk customers in multiple areas of the bank, inability to assess and monitor client relationships on a bank-wide basis, inadequate scope of periodic reviews of customers, weaknesses in the scope and documentation of the validation and optimization process applied to the automated transaction monitoring system, and inadequate customer due diligence;
•Customer due diligence - failed to adequately conduct customer due diligence and enhanced due diligence on its foreign correspondent customers, its retail banking customers, and its international personal banking customers and did not properly obtain and analyze information to ascertain the risk and expected activity of particular customers;
•Audit function - The Bank’s independent BSA/AML audit function failed to identify systemic deficiencies found by the OCC during the examination process.; •Monitoring of its remote deposit capture and international cash letter instrument processing in connection with foreign correspondent banking; and
•Suspicious activity reporting related to that monitoring.
The Order requires Citi to remedy the deficiencies identified by the OCC and enhance its BSA/AML compliance program and audit function. In addition, the Order requires Citi to conduct an independent review of account and transaction activities commonly referred to as a “Look-Back”. The purpose of the Look-Back is to determine whether suspicious activity was timely identified and reported by Citi.
On April 5, 2012, the Office of the Comptroller of the Currency (“OCC”) issued a Cease and Desist Order against Citibank, N.A. (“Citi”).
The Order requires Citi to take comprehensive corrective actions to improve its Bank Secrecy Act (“BSA”) Compliance Program. The OCC found the following deficiencies:
•Internal controls - incomplete identification of high risk customers in multiple areas of the bank, inability to assess and monitor client relationships on a bank-wide basis, inadequate scope of periodic reviews of customers, weaknesses in the scope and documentation of the validation and optimization process applied to the automated transaction monitoring system, and inadequate customer due diligence;
•Customer due diligence - failed to adequately conduct customer due diligence and enhanced due diligence on its foreign correspondent customers, its retail banking customers, and its international personal banking customers and did not properly obtain and analyze information to ascertain the risk and expected activity of particular customers;
•Audit function - The Bank’s independent BSA/AML audit function failed to identify systemic deficiencies found by the OCC during the examination process.; •Monitoring of its remote deposit capture and international cash letter instrument processing in connection with foreign correspondent banking; and
•Suspicious activity reporting related to that monitoring.
The Order requires Citi to remedy the deficiencies identified by the OCC and enhance its BSA/AML compliance program and audit function. In addition, the Order requires Citi to conduct an independent review of account and transaction activities commonly referred to as a “Look-Back”. The purpose of the Look-Back is to determine whether suspicious activity was timely identified and reported by Citi.
