U.S. Bancorp is hopeful that an order issued aimed at getting the bank to strengthen its anti-money laundering efforts will be lifted by the end of 2018.
According to American Banker, analysts agree with the company’s CFO, Terry Dolan, who made the prediction at an industry conference in New York this week.
“We do hope that, and believe that, as we get into the late second quarter, early third quarter, that the regulators will now start to ... make judgments with respect to sustainability,” said Dolan. “Our expectation is that we will get out of the consent order in 2018.”
He added that the Minneapolis-based bank has upgraded its money laundering defenses, including hiring new employees, revamping old processes and improving its technology. Most of these changes were completed by the end of 2017.
The efforts are a result of a consent order that the bank signed with the Office of the Comptroller of the Currency in October 2015. U.S. Bancorp admitted that it failed to look into certain suspicious customer accounts, as well as concealed key information from its regulator.
Some of the misconduct centered around one of the bank's longtime customers, Scott Tucker, who American Banker described as a former payday lending baron who is now serving a prison sentence of more than 16 years.
In addition, U.S. Bancorp admitted that it did not monitor Western Union transactions carried out at its branches by people who were not customers.
The bank, which has $462 billion in assets, was charged with two felony violations. It entered into a deferred prosecution agreement and was ordered to pay $613 million in penalties. As part of the deal, prosecutors will work to dismiss the charges after two years if the bank is able to prove to its regulators that its new efforts are “both effective and sustainable.”