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The FDIC has posted an agenda for its next Board of Directors meeting, to be held at 10 a.m. on October 17, 2024.

The meeting will be open to the public for observation via webcast.

The current agenda lists the following items for consideration at the meeting:

• Briefing: Semi-annual Update on the Deposit Insurance Fund Restoration Plan
• Designated Reserve Ratio for 2025
• Delay of Compliance Date for [Certain] [Subpart A] Amendments to FDIC Official Sign and Advertising Rule
• Minutes of a previous Board meeting

FinCEN has published [89 FR 82499] in today's Federal Register an order issued under authority from the Combating Russian Money Laundering Act to prohibit certain transmittals of funds by any covered financial institution involving PM2BTC, a financial institution operating outside of the United States determined to be of a primary money laundering concern in connection with Russian illicit finance.

The order became effective on publication.

The OCC, Federal Reserve Board, Department of Justice and FinCEN have announced coordinated actions against Toronto-Dominion Bank, TD Bank US Holding Company, TD Bank, N.A., and TD Bank USA, N.A. for deficiencies in the bank’s Bank Secrecy Act (BSA) and anti-money laundering (AML) compliance program. Yesterday’s actions also impose a restriction on the growth of the bank and a measure designed to ensure that the bank invests sufficient resources to remediate its BSA/AML deficiencies in a timely manner.

The regulators and the Justice Department found that the bank failed to develop and maintain a BSA/AML program reasonably designed to assure and monitor compliance with the BSA and its implementing regulations. Deficiencies in the bank’s BSA/AML program included those related to internal controls and risk management practices; risk assessments; customer due diligence; customer risk ratings; suspicious activity identification, evaluation, and reporting; governance; staffing; independent testing; and training, among others.

The OCC also found that the bank had significant, systemic breakdowns in its transaction monitoring program. The bank processed hundreds of millions of dollars of transactions with clear indicia of highly suspicious activity, creating a potential for significant money laundering, terrorist financing, or other illicit financial transactions. The bank repeatedly failed to take appropriate and timely corrective action to address the highly suspicious activity and failed to properly emphasize BSA/AML compliance.

The bank had a systemic breakdown in its processes to identify and report suspicious activity, and a pattern or practice of noncompliance with the suspicious activity report filing requirement, resulting in numerous violations. The bank also violated currency transaction reporting requirements on numerous occasions.

• The OCC imposed a $450 million civil money penalty and imposed a limit on asset growth on TD Bank, N.A. and TD Bank USA, N.A.
• FinCEN imposed a $1.3 billion penalty and a four-year monitoring requirement.
• The Federal Reserve Board reported it has fined Toronto-Dominion Bank $123.5 million and imposed enhanced measures to comply with anti-money laundering laws and to correct its risk management deficiencies.
• The Department of Justice announced that TD Bank N.A., and its parent company TD Bank US Holding Company pleaded guilty and agreed to pay over $1.8 billion in penalties.

For additional information see "TD Bank to pay $3 billion and restrict growth for BSA/AML deficiencies," in the BankersOnline Penalties pages.

The Federal Bureau of Investigation has issued a Public Service Announcement concerning a counterfeit check scheme in which fraudsters target law firms engaged in collections work by deceptively contracting their services to ultimately defraud them. The FBI said the scheme may focus on any type of representation where a lawyer is hired to assist in the transfer or collection of money, e.g. real estate, collection matters, collaborative law agreements in family matters, etc. This scenario continues to be replayed as part of a sophisticated scam that targets collections lawyers and the scope is constantly evolving.

In general, said the FBI, the scheme involves a phony debtor sending a fraudulent check to a collections law firm to satisfy a non-existing debt, and the law firm wire transferring all or part of the check to its client -- the party behind the scheme. The law firm's bank charges the deposited check back to the law firm when it learns it was fraudulent, and the law firm is left with the loss.

The FDIC has issued FIL-72-2024 to extend the comment period on its August 24, 2024, proposed amendments that would strengthen the prudential protections of the safety and soundness rules on brokered deposit in 12 CFR 337.6 and 12 CFR 303.243.

The comment period, which was scheduled to end on October 22, has been extended to end on November 21, 2024.

Yesterday, the Treasury Department reported that OFAC has designated three individuals and one sham charity that are prominent international financial supporters of Hamas, as well as one Hamas-controlled financial institution in Gaza. OFAC also designated a longstanding Hamas supporter and nine of his businesses. These actors play critical roles in external fundraising for Hamas, often under the guise of charitable work, that finance the group’s terrorist activities. Yesterday’s action, which was taken under the counterterrorism authority in Executive Order 13224, highlights the abuse of the non-profit organization (NPO) sector by terrorist financiers through the use of sham charities to generate revenue.

For the names and identification information of the designated parties, see yesterday's BankersOnline OFAC Update.

Yesterday, the OCC reported it had issued a proclamation allowing national banks, federal savings associations, and federal branches and agencies of foreign banks to close offices in areas of Florida affected by Hurricane Milton.

In issuing the proclamation, the OCC expects that only those bank offices directly affected by potentially unsafe conditions will close. Those offices should make every effort to reopen as quickly as possible to address the banking needs of their customers.

• OCC Bulletin 2012-28, Supervisory Guidance on Natural Disasters and Other Emergency Conditions

FinCEN has posted additions and updates to its FAQ page on the Beneficial Ownership Information Reporting requirements. Updated and added questions are dated October 3, 2024.

The FDIC has issued FIL-71-2024 with materials pertaining to the Call Report for the September 30, 2024, report date and guidance on certain reporting issues. The FIL and accompanying Supplemental Instructions should be shared with the individual(s) responsible for preparing the Call Report at your institution. Completed Call Reports must be received by Wednesday, October 30, 2024.

The Treasury Department yesterday reported that OFAC designated one individual and three companies that have facilitated weapons procurement and smuggling operations for Ansarallah, commonly known as the Houthis. This action targets key procurement operatives and suppliers located in Iran and the People’s Republic of China (PRC) that have enabled the Houthis to acquire dual-use materials and components needed to manufacture, maintain, and deploy an arsenal of advanced missiles and unmanned aerial vehicles (UAVs) against U.S. and allied interests.

Additionally, OFAC designated one entity and two vessels linked with illicit Houthi and Iranian commercial shipments, including one that has transported shipments for Houthi financial official Sa’id al-Jamal and an affiliate of Iran’s Armed Forces General Staff.

For the names and identification information of the designated individuals, entities and vessels, see yesterday's BankersOnline OFAC Update.