On November 21, NYDFS and an international bank entered into a second supplemental consent order covering its settlement over alleged deficiencies in the bank’s Bank Secrecy Act/anti-money laundering and Office of Foreign Assets Control (OFAC) compliance program controls. As previously covered by Infobytes, in 2012, the bank agreed to engage an independent on-site monitor for 24 months to evaluate the New York branch’s BSA/AML and OFAC compliance programs and operations and was issued a $340 million civil money penalty. In 2014 NYDFS issued a subsequent consent order outlining the monitor’s findings, including reports of significant failures in the bank’s transaction monitoring. The 2014 order extended the engagement of the monitor for another two years, outlined remedial measures to address continued deficiencies, and required the bank to pay an additional $300 million civil money penalty. In April 2017, NYDFS and the bank entered into the first supplemental consent order to modify the 2012 and 2014 orders, acknowledging the bank made significant improvements in its BSA/AML compliance program but extended the monitor through December 2018 with all the other terms and conditions of the 2012 and 2014 consent orders remaining in full effect.
Now, beginning January 1, 2019, the second supplemental order issued by NYDFS requires the bank to engage an independent consultant, selected by the regulator, for a period of up to one year, with a possible extension of one additional year, to provide guidance for completing remediation called for in the 2012 and 2014 consent orders. In response to the second supplemental order, the bank stated it remained “committed to completing the remaining tasks necessary for that remediation.”