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William Barry Comments on the Impact of Capital One's AML Remedial Efforts on Penalty in Law360

"Capital One AML Remediation Stopped More Devastating Blow"


William Barry commented on the U.S. Department of the Treasury (Treasury) handing out a $390 million fine to Capital One for anti-money laundering (AML) failures that led the bank to cash millions of dollars' worth of checks for customers tied to organized crime. The bank's failures to monitor the check-cashing business "cast doubt on the efficacy of the bank's overall AML compliance processes," Barry said. The Treasury's financial crimes unit Financial Crimes Enforcement Network (FinCEN) said in Friday's settlement order that it took into account Capital One's "extensive" remedial steps when assessing the penalty, including the bank's self-reporting and back-filing of over 50,000 currency transaction reports, the tripling of AML staff and budget, and the axing of the entire check-cashing business that gave rise to the violations. The presentations from the bank and its lawyers before FinCEN would have been crucial in getting the points it did for remediation, Barry noted. "I would expect that the bank acknowledged that there were issues with the check-cashing business — the monitoring at that level and how compliance personnel communicated internally and to regulators — and demonstrated that similar types of conduct are now identified, escalated and acted upon in an appropriate way."