US-based financial services company Wells Fargo has been fined $97.8m for shortcomings in implementing the country’s sanctions against certain countries.
The US Federal Reserve Board has imposed a fine of $67.8m for the company’s inadequate monitoring of sanctions compliance at its subsidiary bank, Wells Fargo Bank.
Wells Fargo violated the US sanctions regulations by offering its trade finance platform to a foreign bank, which used the platform to process about $532m in prohibited transactions.
The US Federal Reserve Board has taken the action together with the US Department of the Treasury’s Office of Foreign Assets Control (OFAC).
The treasury department separately fined Wells Fargo Bank $30m for the same violations, which brings the total fine by both agencies up to $97.8m.
According to OFAC, Wells Fargo was fined for potential civil liability for 124 evident violations of three sanctions programmes, for about seven years between 2008 and 2015.
Together with Wachovia Bank, it had offered a foreign bank located in Europe a software that was used to process trade finance transactions with the individuals sanctioned by the US.
OFAC, in its statement, said: “For about seven years beginning in 2008 and ending in 2015, Wells Fargo and its predecessor, Wachovia Bank, provided a foreign bank located in Europe with software that the foreign bank then used to process trade finance transactions with U.S.-sanctioned jurisdictions and persons.
“Wachovia, at the direction of a mid-level manager, customized a trade insourcing software platform for general use by the European bank that Wachovia knew or should have known would involve engaging in trade-finance transactions with sanctioned jurisdictions and persons.”
In December last year, Wells Fargo reached a $3.7bn settlement with the US Consumer Financial Protection Bureau (CFPB) to resolve claims of illegal conduct in the past.
According to CFPB, the bank illegally charged fees and interest on auto loans and mortgages of its consumers, wrongly repossessed their cars, and misapplied their loan payments.
