Hickman & Rose’s Post

What could happen with other Big Global Banks with previous moneylaundering settlements signed or consent orders violated? A hard path ahead e.g. if NPA, DPAs have been breached as repeated offenders and recidivist. Must be considered cases as Danske Bank, recent Swedbank CEO jailed...and which will be the next case to watch as moneylaundering enforcement actions trend by US agencies? As The Wall Street Journal reported by Dylan Tokar "Authorities have alleged that TD was reckless in failing to build and maintain #systems that flagged and prevented #moneylaundering, the people said. The Canadian parent company has already set aside more than $3 billion to cover the costs of resolving U.S. #government #investigations." "TD disclosed the Justice Department probe in August 2023, and began to set aside reserves to account for the costs of resolving what has by now swelled to multiple government investigations." "Financial institutions might not have much leverage once criminal charges are on the table, but they can make the case that they have taken steps to remediate the issues and have no record of previous offenses, industry lawyers said."

TD Bank’s guilty plea and $3 billion in penalties show the high price banks can pay if they fail to comply with anti-money-laundering regulations designed to stop criminal groups from moving the proceeds of illicit activity through the U.S. financial system. Click below to read more on The Wall Street Journal 🔗 https://lnkd.in/erMh_JDF #Compliance #AntiMoneyLaundering #AML #FinancialRegulation #RiskManagement #RegulatoryCompliance #CorporateResponsibility #ComplianceConsulting #DueDiligence #TDBank

Sutton Bank and Piermont Bank join the bonfire of the #BAAS banks. Regulators methodically going through the paces with all of them. C&Ds and consent orders set standards for all partner banks. Not fun to be a director at one of these…or a fintech who relies on one. Biggest consequences in my view: 1. All related costs will be ultimately passed along to #fintech front ends, further undermining the “technology brings cost advantage” thesis for #neobanking 2. Many of the sanctioned partner banks will get out of the business, with 4-5 remaining players who will be very picky about whom they partner with—not good news for new #fintech entrants. 3. $10B Durbin interchange limit will force the remaining partner banks to rely even further on overnight sweep arrangements to control size. 4. If I'm right about 4-5 remaining larger partner banks, then business case for "middle layer" companies (already pivoting to being bank software providers) looking very precarious. [BTW Konrad Alt thinks I'm wrong about consolidation in partner banking, and he's very smart....] #banks #fintech

Todd H Baker (with whom I am not connected, at least not yet!) offers some additional insight on the recent orders involving #fintech #bank partnerships. These things aren't happening in a vacuum, so it's imperative that if you see something in these orders that reflect practices in place at your #financialinstitution, learn from some hard lessons before it becomes your turn to have an #enforcementaction, etc. Nice work by Todd Baker to serve up some key items in the #BAAS world. #risk #compliance #tprm #regulatorycompliance

📢 A tier-one bank has been fined £27.8m by the FCA for failures in the firm’s systems and controls. Learn more in this Global Trading article by Alex Pugh ➡️ https://lnkd.in/errbbk8a #Regulation #Compliance #FinancialSector #regtech #steeleye

📢 A tier-one bank has been fined £27.8m by the FCA for failures in the firm’s systems and controls. Learn more in this Markets Media/Global Trading article by Alex Pugh ➡️ https://lnkd.in/ehQTiZsV #Regulation #Compliance #FinancialSector #SystemsFailures

🚨 Attention UK Financial Institutions 🇬🇧 As the UK gears up for the PSR liability shift in 2024, understanding the implications is crucial for smaller banks and fintechs. Our latest article delves into how these changes will impact your operations and why advanced fraud prevention measures are more important than ever. 👉 Read the full article to stay ahead and prepare your strategies effectively: https://buff.ly/4fvMWNR #UKPSR #FinancialInstitutions #FraudPrevention #ThreatMark #Fintech #BankingSecurity #RegulatoryCompliance

In our latest Anti-Money Laundering client alert, Lowenstein’s Robert Johnston, Samantha Sigelakis-Minski, CAMS, and Angenny M. Rosario, CAMS discuss the unprecedented $3 billion fine imposed on TD for systemic anti-money laundering failures, emphasizing the need for financial institutions to strengthen their compliance programs in light of regulatory scrutiny and potential consequences. Read the full alert: https://bit.ly/4dOX9mz #antimoneylaundering #tdbank #regulatorycompliance #moneylaundering #investmentmanagement #banksecrecyact

FCA Imposes £28.9M Fine on Starling Bank for Compliance Failures Today, the Financial Conduct Authority has fined Starling Bank £28.9 million ($38.4 million) over failures to screen for financial sanctions and for breaching a ban on opening accounts for high-risk clients between September 2021 and November 2023. David Sproul, chairman of Starling Bank has said, "I would like to apologise for the failings outlined by the FCA and to provide reassurance that we have invested heavily to put things right, including strengthening our board governance and capabilities." Starling Bank would have been fined almost £41 million, but it agreed to resolve the problems and therefore qualified for a 30% discount under the regulator's processes which took 14 months to reach an outcome. Despite growing from 43,000 customers in 2017 to 3.6 million in 2023, Starling Bank struggled to maintain adequate financial crime safeguards. For a detailed analysis of this development and its implications for the banking sector, connect with me for a deeper discussion or a trial with Law360 UK. #FinancialServices #Compliance #Banking #FCA #StarlingBank #AML #FinancialCrime #RegulatoryEnforcement #Law360UK

Managing Non-Financial Risks is becoming ever more critical for financial institutions