Shares of Wells Fargo & Company lost 4% following the announcement of a formal agreement with the Office of the Comptroller of the Currency concerning the bank's anti-money laundering (AML) and sanctions risk management practices.
The agreement points out flaws in the bank's anti-money laundering internal controls and risk management procedures in several areas, such as the reporting of suspicious activity and currency transactions, customer due diligence and the bank's customer identification and beneficial ownership initiatives.
The bank first disclosed this probe in its second-quarter Securities and Exchange Commission (SEC) filing, where it mentioned that it is in "resolution discussions" with the U.S. SEC about an investigation related to the cash sweep options it provides to new investment advisory clients.
Wells Fargo has taken a significant step in strengthening its AML and sanctions risk management capabilities with the official agreement with the OCC. The latest agreement is in line with the bank's continuous efforts to enhance its risk management system and adhere to regulatory requirements.
WFC's management stated, "We have been working to address a substantial portion of what's required in the formal agreement, and we are committed to completing the work with the same sense of urgency as ...
