Finance & Economics

Wells Fargo Reportedly Grapples With Obligations to Enhance Monitoring of Financial Crime

The media reports that Wells Fargo is currently making efforts to improve its system for monitoring crimes committed in the financial environment.

Wells Fargo Reportedly Grapples With Obligations to Enhance Monitoring of Financial Crime

American regulators have issued official orders according to which the specified lender, which is part of the structure of the banking sector of the United States, should strengthen its ability to detect and suppress the use of accounts and products of this organization by unauthorized persons for illegal purposes. This was reported by the media on Thursday, November 16, citing unnamed sources.

The above-mentioned orders prescribe, as a matter of priority, the improvement of the mechanisms for the functioning of surveillance systems for consumers of Wells Fargo services and products. Regulators say that this bank allowed the existence of a so-called financial pyramid worth $490 million, which is an example of the consequences of a failure in the activities to identify and suppress machinations. Wells Fargo denies the allegations on this occasion.

The media note that the monitoring activities of banks are of particular importance in the context of combating the financing of terrorist organizations, money laundering, and other crimes that can be stopped at the initial stage by the relevant lenders’ systems. Wells Fargo, as part of improving capabilities aimed at solving these tasks, is currently engaged in transforming its risk management and control apparatus. The media reports that during the implementation of the relevant efforts, the head responsible for compliance with the Bank Secrecy Act, according to which lenders are required to keep records and provide reports related to illegal activity, will be replaced.

There is also information that Wells Fargo is currently taking proactive measures aimed at preventing potential problems.

This bank found itself in a difficult situation in 2016. At that time, it became known that employees of a financial institution created millions of fake customer accounts to achieve sales goals. After the regulators found out about this fact, it were took measures against the bank, including the limitation of the size of the balance sheet introduced by the Federal Reserve System.

In September, the media reported that Wells Fargo would pay $1 billion to settle an investors lawsuit related to a scandal over fake accounts. There are also claims to the bank that the criminal transferred money through an account opened in this organization. Wells Fargo representatives stated that they were not aware of this offense.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.