Ocean Bank to Pay Fine for Bank Secrecy Act Violations

Feb 22, 2011   

As a result of a two year investigation by the United States Department of Justice, Miami-based Ocean Bank is expected to agree to pay between $10 and $15 million in penalties and fines for violations of the Bank Secrecy Act (“BSA”). The violations stem from Ocean Banks BSA compliance weaknesses as evidenced by its failure to file suspicious activity reports and adequately monitor high-risk accounts.

The BSA requires U.S. financial institutions to assist U.S. government agencies in detecting and preventing money laundering. Specifically, the act requires financial institutions to keep records of cash purchases of negotiable instruments, file reports of cash transactions exceeding $10,000, in daily aggregate amounts, and to report suspicious activity that might signify money laundering, tax evasion, or other criminal activities. General information about the Bank Secrecy Act can be found on FinCENs website.

This is not the first time Ocean Bank has had anti-money laundering and Bank Secrecy Act compliance issues. In March 2007, Ocean Bank consented to the issuance of a Cease and Desist Order by the FDIC and the Florida Office of Financial Regulation. The 2007 Order required Ocean Bank to improve most aspects of its anti-money laundering compliance program including the monitoring of high-risk accounts and the reporting of suspicious activity. A copy of the March 2007 Cease and Desist Order can be read on FDICs website here.

In 2008, the FDIC issued a Modified Cease and Desist Order which ordered the bank to correct its violations of federal capital requirements and lending rules. The Modified Cease and Desist Order can be read here. Ocean Bank also currently faces a civil suit by a former employee who alleges that she was fired for reporting suspicious activity of customers. In November 2010, a Miami judged ruled that the former employee can discuss what the suspicious activity in question was in presenting her case but federal law prohibits the disclosure of whether she reported the suspicious activity to the U.S. Treasury Department.

If you have questions pertaining to the Bank Secrecy Act, FinCEN regulations, anti-money laundering compliance or how to ensure that your business maintains regulatory compliance at both the state and federal levels, contact Fuerst Ittleman PL at contact@fidjlaw.com.