The US Securities and Exchange Commission stated Friday that Wells Fargo Advisors, a subsidiary of banking behemoth Wells Fargo & Company, has agreed to pay $7 million to resolve claims that it violated federal anti-money laundering rules by failing to file suspicious activity reports.
According to an SEC announcement, the subsidiary failed to properly implement a new version of its internal anti-money laundering, or AML, monitoring and warning system that it implemented in January 2019. As a result, it failed to timely file at least 25 suspicious activity reports connected to wire transactions to or from foreign nations deemed at risk of enabling "money laundering, terrorist financing, or other unlawful money movements," according to the SEC.
"When SEC registrants like Wells Fargo Advisors fail to comply with their AML obligations, they endanger the investing public by depriving regulators of timely information about possible money laundering, terrorist financing, or other illegal money movements," said Gurbir S. Grewal, director of the SEC's Division of Enforcement. "By taking this enforcement action, we are not only holding Wells Fargo Advisors responsible but also sending a strong message to other registrants that AML requirements are sacred."
In addition to the $7 million penalties, Wells Fargo Advisors consented to a censure and a cease and desist order without admitting or rejecting the SEC's allegations.