Texas Bank Issued Cease and Desist Order for BSA/AML Deficiencies

Texas Bank Issued Cease and Desist Order for BSA/AML Deficiencies

Commercial State Bank, a $676 million bank in Andrews, Texas, has been issued a Consent Cease and Desist Order by the Federal Reserve Bank of Dallas and the Texas Department of Banking  for significant deficiencies in the bank’s risk management and compliance with Bank Secrecy Act/anti-money laundering (BSA/AML) applicable laws, rules, and regulations.

The bank was directed to take action with regard to board oversight; the bank’s BSA/AML compliance program; customer due diligence; suspicious activity monitoring and reporting; the bank’s transaction monitoring system; and independent testing.

According tp the order, executed Dec. 26, the bank’s board of directors has 60 days to submit a written plan to strengthen board oversight of the bank’s BSA/AML compliance and submit an “enhanced” written BSA/AML compliance program; a written revised program for conducting “appropriate levels of customer due diligence”; and a written enhanced program “to reasonably ensure the identification and timely, accurate, and complete reporting by the Bank of all known or suspected violations of law or suspicious transactions to law enforcement and supervisory authorities.” Commercial State Bank must also engage an independent third party acceptable to the supervisors to validate effectiveness of the it’s transaction monitoring system and to report findings, conclusions and recommendations.  Lastly, the Bank must submit an acceptable written plan for independent testing of the it’s compliance with all applicable BSA/AML requirements.

January 16th, 2019|