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Sunday, Jan 29, 2023

MUFG Bank Enters Into Consent Order With US Regulator to Correct Bank Secrecy Act Compliance

MUFG Bank Ltd., the largest bank in Japan, entered into a consent order with the federal regulator of nationally chartered banks in the United States to fix deficiencies in its Bank Secrecy Act compliance program at branches in Los Angeles, Chicago and New York City.

The consent order follows the U.S. Office of the Comptroller of the Currency’s recent examination of MUFG Bank’s U.S. branches for Bank Secrecy Act and Anti-Money Laundering sanctions compliance, and stems from new findings that MUFG Bank failed to address concerns based on a 2016 investigation.

The 2016 investigation only included MUFG offices in New York and Chicago. The L.A.-based MUFG Bank office was added to the latest consent order, disclosed in late February by the OCC. Copies of the consent orders – one filed in 2017 and the other in February – do not contain specifics of the problem areas in the three branches.

The L.A. federal branch of MUFG Bank, which is located at 445 S. Figueroa St., conducts commercial and wholesale business in the U.S.

OCC spokesman Brian Hubbard said the consent order “reflects weaknesses” in the Bank Secrecy Act and Anti-Money Laundering compliance. “Of course, this is an important issue,” Hubbard said. “We did not issue a fine in this case.”

“The branches failed to timely file suspicious activity reports” dating back to June 2016, according to the consent order obtained by the Business Journal. “The branches have begun corrective actions and are committed to remedying the deficiencies identified by the OCC.”

MUFG Bank spokesman Dan Weidman said the bank is “taking immediate corrective action to ensure that there is a complete remediation of all deficiencies.”

He said the bank has “made substantial investments over the last several years” to bring the institution into full compliance. “MUFG Bank is committed to conducting business with the highest levels of integrity, and to continually improving its regulatory compliance,” Weidman said.

The consent order does not identify any illegal transactions, including any violations of regulations overseen by the Office of Foreign Assets Control, which is a financial intelligence and enforcement agency of the U.S. Treasury Department. It administers and enforces economic and trade sanctions in support of U.S. national security and foreign policy objectives.

MUFG Bank serves as the core retail, corporate and investment banking arm of Mitsubishi UFJ Financial Group Inc. It operates separate from MUFG Union Bank, whose main office is based in San Francisco and is the U.S. banking arm of Japanese holding company Mitsubishi UFJ Financial Group, and has 338 branches in the U.S. West.

The corporate headquarters for MUFG Americas Holdings Corp. and MUFG Union Bank is in New York.

Finance reporter Pat Maio can be reached at pmaio@labusinessjournal.com or (323) 556-8329.


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