OCC Announces May 2024 Enforcement Actions, Highlighting Increasing Compliance Obligations and Enforcement

The Office of the Comptroller of the Currency (OCC) today released its latest round of enforcement actions taken against national banks, federal savings associations, and individuals affiliated with OCC-supervised banks.

On the institutional side, the OCC entered into a formal agreement with Comerica Bank & Trust, National Association for unsafe or unsound practices, including issues related to the bank's risk governance framework and internal controls. The agreement compels Comerica to take timely corrective actions. Separately, Lemont National Bank in Lemont, Illinois also faced a formal agreement from the OCC citing deficient practices around capital planning, strategic planning, succession planning, and liquidity risk management that the bank must remediate.

In addition to the institutional actions, the OCC took several enforcement measures against individual bank employees and former employees:

• An Order of Prohibition against Stanley Acosta, a former bank employee at a Santander branch, for stealing approximately $27,449 from customer cash deposit bags.
• An Order of Prohibition against Bahtia Greene, a former operations processor at a Wells Fargo lockbox facility, for misappropriating and selling customer information resulting in $688,000 in losses.
• A Notice of Charges against Gerald E. Milligan II, a former PNC Bank teller, alleging he made false attestations and provided fabricated documentation to improperly obtain $141,530 in Paycheck Protection Program loan funds for personal use.
• An Order of Prohibition against Sabina Prince, a former PNC Bank teller, for taking $15,000 in cash from the bank and manipulating records to conceal it.
• An Order of Prohibition against Stephanie Sanders, a former NBT Bank relationship banker, for misappropriating approximately $30,650 from the bank by crediting her own accounts over 100 times.

The latest enforcement actions showcase the OCC's ongoing efforts to identify and punish lapses in compliance, internal controls, risk management and ethical conduct at national banks and the individual level. They highlight the regulator's expectations for robust compliance programs and cultures at OCC-regulated institutions.

This heightened scrutiny from the OCC aligns with other major enforcement actions earlier this year, such as the $250 million civil money penalty levied against JPMorgan Chase Bank, N.A. in March 2024 for deficiencies in its trade surveillance program.

Another prominent example was the $65 million penalty against City National Bank in February 2024, stemming from systemic deficiencies in risk management, internal controls, and violations of Bank Secrecy Act (BSA) and fiduciary activity requirements. The OCC issued a cease-and-desist order requiring City National to implement comprehensive corrective actions.

There has also been a recent surge in BSA enforcement, with institutions like MGM Grand and Cosmopolitan in Las Vegas facing millions in penalties for BSA violations. A New York man also recently pleaded guilty to BSA violations linked to a $1 billion scheme, underscoring regulators' determination to enforce anti-money laundering compliance.

Such stringent actions demonstrate regulators' intensifying focus on identified compliance lapses across areas like trading surveillance, risk management, BSA/AML, and fiduciary responsibilities. It is likely to spark further industry-wide scrutiny and heightened expectations for financial institutions to bolster risk management and monitoring capabilities.

The escalating enforcement trajectory signals that robust compliance programs are not just a check-box exercise, but a fundamental necessity for banks to operate safely and soundly while meeting regulatory obligations. Substantial penalties and corrective actions make clear there is no room for complacency on the compliance front.

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