The US Federal Reserve announced Thursday that it had fined Wells Fargo $67.8 million for “inadequate oversight” of sanctions risk at one of its subsidiary banks. The US central bank said in a statement that the San Francisco-based financial services company’s “deficient oversight” enabled it to violate US sanctions regulations. The violation included providing “a trade finance platform to a foreign bank” that used the platform to process approximately $532 million in prohibited transactions between 2010 and 2015. Fed said the decision was taken in conjunction with the US Treasury Department’s Office of Foreign Assets Control (OFAC). The total penalty announced by both agencies is approximately $97.8 million, the Fed said in a statement. The Treasury Department said in a separate statement that it had reached a settlement with Wells Fargo in which the bank agreed to remit $30 million to settle its potential civil liability for violations of sanctions against Iran, Syria, and Sudan. “For about seven years beginning in 2008 and ending in 2015, Wells Fargo and its predecessor, Wachovia Bank, provided a foreign bank located in Europe with software that the foreign bank then used to process trade finance transactions with U.S.-sanctioned jurisdictions and persons,” the Treasury said in a statement. “Wachovia, at the direction of a mid-level manager, customized a trade insourcing software platform for general use by the European bank that Wachovia knew or should have known would involve engaging in trade-finance transactions with sanctioned jurisdictions and persons,” it added. Once the fourth-largest bank holding company in the US based on total assets, Wachovia was acquired by Wells Fargo in 2008 during the financial crisis.
Source: Anadolu Agency