Regulators have ordered a total of five Fulton Financial Corp. entities to improve deficiencies in their Bank Secrecy Act and anti-money laundering compliance. Fulton Financial and Lafayette Ambassador Bank entered into cease and desist orders this month with the Federal Reserve for compliance deficiencies for anti-money laundering. (see PDF) Three other Fulton subsidiaries—Fulton Bank, Swineford National Bank and FNB Bank — were cited by the Office of the Comptroller of the Currency for very similar AML compliance deficiencies in July. (see PDF)
The $18 billion-asset Fulton said that responsibility for its compliance program switched in January from the subsidiary banks to the corporation, a telling shift that acknowledged the subsidiaries did not have the proper resources to comprehensively monitor and ensure the Banks were in compliance. Many recent consent orders specifically target the board and place the onus on a compliance committee to get things fixed. A few have specifically required the creation of a BSA/AML committee. A good AML compliance program is integrated into the culture of the organization. Product and business-line managers should be trained on the basics to look for, while the buck stops with an independent BSA officer who has a direct line of communication to the board and is empowered to override business decisions if something appears amiss. If a corporation has one or more subsidiaries that cannot meet those compliance demands, change in responsibility should be seriously considered.
Where does the buck stop at your institution?