Compliance & Ethics

New York Attorney General Letitia James has initiated legal action against Citibank, N.A. (Citi), accusing the banking giant of neglecting to protect customers and refusing reimbursement to victims of fraud. The lawsuit alleges a range of misconduct, including the failure to implement robust online security measures, misleading account holders about their rights following unauthorized access, and illegal denial of reimbursement to victims of fraud.

The Office of the Comptroller of the Currency (OCC) has invited public comments on its recently proposed rulemaking and policy statement, which aims to modernize the rules governing business combinations involving national banks and federal savings associations. The proposal is designed to augment transparency in the OCC's review process under the Bank Merger Act (BMA) and offer additional clarity to stakeholders.

The former president of MGM Grand casino, Scott Sibella, has pleaded guilty to a federal criminal charge for violating the Bank Secrecy Act (BSA) by failing to report suspicious transactions. The Justice Department disclosed this information, highlighting related settlements with MGM Grand and The Cosmopolitan of Las Vegas casinos, requiring them to pay a combined $7.45 million, undergo external review, and enhance their anti-money laundering (AML) compliance programs.

The Financial Reporting Council (FRC) has unveiled crucial revisions to the UK Corporate Governance Code, designed to elevate transparency, bolster accountability, and strengthen the competitiveness of the UK as an investment destination. The changes, outlined in the FRC's Policy Statement of November 7, respond to extensive stakeholder consultation, marking the largest ever conducted by the FRC in 2023.

The New York State Department of Financial Services (NYDFS) Superintendent Adrienne A. Harris has announced an $8 million penalty against Genesis Global Trading, Inc. The penalty comes after a comprehensive investigation by the NYDFS revealed substantial shortcomings in the company's Anti-Money Laundering (AML) and cybersecurity programs, violating the department's virtual currency regulations. This enforcement marks the first penalties imposed by the NYDFS on virtual currency companies and underscores its commitment to upholding regulatory standards.

J.P. Morgan Securities LLC (JPMS) has agreed to pay an $18 million civil penalty to settle charges brought by the Securities and Exchange Commission (SEC). The charges relate to JPMS impeding advisory clients and brokerage customers from reporting potential securities law violations to the SEC, a violation of the Whistleblower Protection Rule.

Both the U.S. Securities and Exchange Commission (SEC) and the Department of Justice (DOJ) have charged Morgan Stanley & Co. LLC and its former head of equity syndicate desk, Pawan Passi, with engaging in a multi-year fraud scheme related to the disclosure of confidential information concerning the sale of large quantities of stock, commonly known as "block trades." The SEC's press release details the charges, and the DOJ has announced resolutions involving non-prosecution agreements (NPA) and deferred prosecution agreements (DPA).