BSA fines/penalties reap $12 billion since 2009, GAO reports

April 25, 2016 -- Fines and penalties for non-compliance with the Bank Secrecy Act (BSA) and anti-money laundering efforts has reaped more than $12 billion since 2009, according to a recent federal report.

According to a Government Accountability Office (GAO) report issued last week (April 21), financial institutions have been assessed about $12 billion in fines, penalties and forfeitures for violations of BSA/anti-money laundering regulations since 2009. Of that, over the seven-year period of 2009-15, about $5.2 billion was assessed on financial institutions by federal agencies for BSA/AML violations specifically; $27 million for Foreign Corrupt Practices Act (FCPA) violations, and; $6.8 billion for violations of U.S. sanctions program requirements, according to the GAO report.

Further, in four of the seven years covered by the report’s findings, BSA/AML assessments were far greater than those related to FCPA or U.S. sanctions programs.

According to the report, the fines and penalties collected are deposited into the U.S. Treasury’s General Fund accounts, after which the funds are available for appropriation and use for general support of the U.S. government.

GAO stated that, based on its review of regulators’ data and enforcement orders, the federal banking regulators assessed penalties for failure to implement or develop adequate BSA/AML programs, and failure to identify or report suspicious activity.

The report illustrates that, among federal financial institution regulators, the OCC has assessed the most penalties (“independently and concurrently with the Financial Crimes Enforcement Network (FinCEN)”), with the Federal Reserve, Securities and Exchange Commission (SEC) and FDIC following.

A footnote in the report states that NCUA officials said they had not assessed any penalties during that time period. Separately, Credit Union Times reported that, according to an NCUA spokesman, the agency “has taken a proactive approach aimed at avoiding or resolving problems before they get to such a serious level that penalties are assessed.”

Summary, GAO report: Fines, Penalties, and Forfeitures for Violations of Financial Crimes and Sanctions Requirements (with additional links to full report)

NASCUS/CUNA BSA conference, Nov. 13-16, San Antonio