WASHINGTON (Reuters) - The U.S. Justice Department has reached a $613 million settlement with U.S. Bancorp (USB.N) over charges that it willfully failed to have an adequate anti-money-laundering program, the department said on Thursday.
As part of the settlement, U.S. Bancorp agreed to forfeit $453 million and to pay fines to the Treasury Department, the Office of the Comptroller of the Currency and the Federal Reserve, the Justice Department said in a statement.
It said that the bank, through its subsidiary U.S. Bank National Association, deliberately ran an inadequate anti-money-laundering program from 2009 to 2014. U.S. Bancorp failed to detect large numbers of suspicious transactions and concealed its missteps from regulators, it said.
“We regret and have accepted responsibility for the past deficiencies in our AML (anti-money-laundering) program. Our culture of ethics and integrity demands that we do better,” President and Chief Executive Andy Cecere said in a statement.
Under the settlement, the Justice Department agreed to dismiss the charges against the Minneapolis-based bank in two years if it meets the terms of the agreement. The bank said it has overhauled its anti-money-laundering policies in recent years to address the issues.
The Justice Department said the bank limited the number of transactions its systems would flag as suspicious based on its staffing levels. A 2009 memo from the bank’s anti-money laundering officer warned that staff was “stretched dangerously thin,” and U.S. Bancorp hid its limitations from regulators, it said.
The Justice Department also claimed the bank processed Western Union transactions for non-customers, even though those transactions would not be monitored. The bank barred those wire transfers in 2014.
Authorities also charged that the bank willfully failed to report suspicious banking activities of a longtime customer, Scott Tucker, from 2011 to 2013.