Wells Fargo Advisors Warned of Possible Action for Anti-Money Laundering Failures

Attorney Advising Disclaimer

FINRA warned Wells Fargo Advisors, LLC it is contemplating regulatory action for Wells Fargo's alleged anti-money laundering (AML) program failures, indicating the regulator may recommend disciplinary action in response to findings that the firm has violated FINRA rules and policies.

According to Wells Fargo Advisors' BrokerCheck report, FINRA accused the firm of failing to "implement policies and procedures reasonably defined to achieve compliance with the Bank Secrecy Act."

In regards to the purported violative AML policy, the investigation's relevant period is over four years old.

Wells Fargo previously was sanctioned for failures to comply with the Bank Secrecy Act.

In 2010, Wells Fargo acquisition Wachovia Bank agreed to pay $160 million in connection with an investigation and federal case into AML program failures and Bank Secrecy Act violations from 2003-2008 in which Wachovia admitted failing to monitor $420 billion in transactions.

The $420 billion that went unmonitored traveled through Mexican exchange houses known as casas de cambio (CDCs) and, according to that investigation, was a vehicle used by drug cartels to launder money through Wachovia.

The 2010 report stated that in exchange for Wells Fargo's admission of fault and agreement to pay $160 million, the government agreed to dismiss the criminal charge.

As part of the investigation, Wachovia detailed how the drug cartels were able to move their funds: "Once the drug dollars were placed into CDCs, they were readily wire transferred into bank accounts of CDCs at Wachovia," the firm explained.

Added the Drug Enforcement Administration, "When the bank failed to have effective anti-money laundering procedures in place, it allowed these traffickers to use the bank to their will." The DEA stated that lack of effective procedures prevented Wachovia from being able to tell the true nature of the funds being transferred.

If you have invested with Wells Fargo Advisors, Wachovia Bank or with any FINRA-member broker-dealer or advisory firm whose program or due diligence failures suggest further compliance deficiencies with the Bank Secrecy Act, SEC Securities Exchange Act, FINRA/NASD rules of conduct or any other regulations and such inadequate systems have proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.

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