Miami-based International Finance Bank disclosed that it signed a consent order with state and federal regulators aimed at shoring up its anti-moneylaundering program.
The small state-chartered bank said it has already taken various steps to step up compliance with regulations in light of the Oct. 28 consent order. That includes hiring a veteran banker who has extensive experience in complying with the Bank Secrecy Act and anti-moneylaundering regulations and installing a new software system aimed at improving the bank’s ability to ferret out suspicious activity.
The bank named Humberto Diaz, a former executive at Espirito Santo Bank in Miami, as vice president for Bank Secrecy Act and anti-moneylaundering regulation, and deployed additional staff to tackle the consent order.
The bank — part of Grupo IF of Madrid, Spain —signed the consent order Oct. 28 and disclosed the enforcement action Monday when it was posted on the Federal Deposit Insurance Corp.’s website.
“We are making sure going forward our controls are in place,’’ said Carlos Blanco, president and chief executive officer of International Finance Bank, which has assets of about $350 million and three offices in Miami-Dade County. “We have 72 people. Seven are part of the BSA staff. Regulation demands a lot of resources.’’
Blanco said the regulators’ concern grew out of a joint visit to the bank in May by the FDIC and the Florida Office of Financial Regulation, which conducted a 30-day examination that turned up concerns about its BSA and anti-moneylaundering efforts.
In the consent order, the bank neither admits nor denies unsafe or unsound banking practices or violations of law or regulation related to any weaknesses in complying with the Bank Secrecy Act and anti-moneylaundering regulations. As is common in such enforcement actions, the consent order focuses on remedies, without detailing specific shortcomings turned up during the examination.
In addition to bolstering staff and systems, the bank is upgrading its wire transfer system to provide better controls and improving its monitoring of suspicious activities related to cash, ATM, and automated clearinghouse transactions. As part of the consent order, the bank agreed to “look back” at a number of customer accounts identified during the examination to check for suspicious activity.
Separately, IFB, which has been under a 2011 consent order related to its asset quality, said it sold a portfolio of about $19 million in troubled loans on Dec. 3 in a major step forward with no negative impact to its earnings. “By having sold the portfolio, we have a clean bank that will have one percent in nonaccrual loans,’’ Blanco said. “Going forward, we may focus on growth, rather than just the recovery processes.’’