Capital One Financial has been fined $ 290 million after admitting to the U.S. Treasury Department that it deliberately violated money laundering requirements between 2008 and 2014.
The problems, which involved a unit that serves cash control businesses and has since been shut down, were first made public years ago. But documents released by the Treasury’s Financial Crimes Enforcement Network on Friday contain new details, including acknowledging to Capital One that it did not file suspicious activity reports, even when it was aware of criminal charges against specific clients.
“The failures set out in this enforcement action are dire,” Kenneth Blanco, director of Fincen, said in a press release. “Capital One has deliberately disregarded its obligations under a high-risk business unit.”
Bloomberg
A Capital One spokesman said in an email that McLean, the U.S.-based company, was happy to resolve the matter, citing the latest remaining government investigation into a business that has now disappeared and saying that the firm is completely reserved to pay the nine. -number penalty.
“Capital One takes its money laundering obligations very seriously,” the company spokesman said. “Over the past few years, under the new AML leadership, the bank has invested heavily in improving its AML program and has worked closely with regulators and law enforcement to ensure that our compliance processes and protocols are sound.”
Capital One acquired the check-related group in 2006 at New York-based North Fork Bank. According to the document that Fincen released Friday, there were dozens of checking computers in the New York and New Jersey area. Services that included unit check processing and cash shipments of armored vehicles.
Capital One has admitted mistakes regarding currency transaction reports, which banks have to submit to the government when customers make cash transactions of more than $ 10,000. The $ 422 billion asset acknowledged that it was negligent in submitting reports on approximately 50,000 transactions totaling more than $ 16 billion.
Capital One also admitted that it did not file suspicious activity reports in connection with Domenick Pucillo, who owns numerous check investment firms in the New York area. Pucillo was described by Fincen on Friday as a convicted member of the Genoese organized crime family and the fourth largest customer of Capital One’s business unit serving cashiers.
The bank learned in 2013 of possible criminal charges against Pucillo in New Jersey. Nevertheless, Capital One subsequently gave Pucillo permission to execute more than 20,000 transactions worth about $ 160 million to 23 deposit accounts, according to Fincen.
Capital One has closed the commercial banking unit that served cash operations in 2014. Five years later, Pucillo pleaded guilty to conspiracy to launder money, in connection with the loan shark and illegal gambling proceeds flowing through his Capital One accounts.
“The serious failures of Capital One have made it possible for known criminals to use and abuse the country’s financial system unnoticed, which has perpetuated criminal activity and allowed it to continue to flourish at the expense of victims and other citizens,” Blanco said. said. “These kinds of failures by financial institutions, regardless of their size and religious influence, will not be tolerated.”
Fincen said Capital One took important steps to cooperate with the investigation and to rectify the problems, which he took into account in determining the size of the fine assessed. The civil fine amounts to $ 390 million, but Capital One was credited with $ 100 million for a fine it paid in 2018 to the office of the currency controller.
The OCC Capital One launched a enforcement action in 2015 in connection with the performance of money laundering within the same business unit. This consent order was concluded in 2019.