According to the Securities and Exchange Commission (SEC), between March 2012 and June 2013, Wells Fargo failed to comply with anti-money laundering (AML) rules and did not file up to 50 “Suspicious Activity Reports” that are mandatory by the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) and the Bank Secrecy Act. Because of this, Wells Fargo was fined $3.5 million for their lack of compliance.
Wells Fargo Advisors have not admitted to or denied these findings, but allegedly told its SAR investigators that they were filing too many SAR’s, that in order to file a SAR they are required to provide proof of the illegal activity, and that SAR reviews of continuing activity were not a requirement. In addition to the $3.5M fine, Wells Fargo agreed to a cease-and-desist order as well as a censure.
Additionally, FINRA fined a former Wells Fargo Advisor representative, Cecil Byers, $10,000 and gave him a two month suspension for not informing the firm of his appointment to co-executor and beneficiary of a client’s estate, which he learned of 2 days prior to his client’s death. Wells Fargo Advisors requires that all reps obtain permission from compliance before accepting any such appointments but the firm didn’t find out about Byers’ new appointment until approximately 2 months later when a probate litigation notice was received objecting to Byers’ position.
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