FinCEN assessed Capital One a $390 million civil money penalty on January 15, 2021 for willfully failing to implement an effective AML program and willfully failing to file thousands of SARs — and negligently failing to file thousands of CTRs — for its Check Cashing Group business from 2008 through 2014, including failure to report transactions by a convicted Genovese crime family associate.

Capital One, N.A. — BSA/AML Willful Violations, $390 Million FinCEN Penalty (2021)

Outcome: FinCEN assessed Capital One, National Association a $390 million civil money penalty on January 15, 2021 for engaging in both willful and negligent violations of the Bank Secrecy Act related to its Check Cashing Group business unit from 2008 through 2014, including willful failure to file thousands of SARs and negligent failure to file thousands of CTRs.

Capital One, National Association — headquartered in McLean, Virginia — operated a specialized business unit called the Check Cashing Group (CCG) that served check cashing businesses as clients. From at least 2008 through 2014, Capital One willfully failed to implement and maintain an effective AML program for this business unit, willfully failed to file thousands of suspicious activity reports, and negligently failed to file thousands of currency transaction reports with respect to CCG transactions.

The violations allowed millions of dollars in suspicious transactions to go unreported to FinCEN over a six-year period, including proceeds connected to organized crime, tax evasion, fraud, and other financial crimes. The most egregious documented case involved Domenick Pucillo, a convicted associate of the Genovese organized crime family, who operated a network of check cashing businesses. Capital One had actual knowledge of criminal charges against Pucillo yet continued to process over 20,000 transactions valued at approximately $160 million for his businesses without timely filing SARs.

The $390 million total enforcement action reflected both FinCEN's civil money penalty ($290 million paid to the U.S. Department of Treasury) and a credit for the $100 million Capital One had previously paid to the OCC in 2018 for similar violations. The FinCEN penalty — the largest assessed against a bank in U.S. history at the time — demonstrated that willful BSA violations extending over years and involving deliberate non-reporting in the face of known criminal activity would be met with landmark penalties.

Primary Source: FinCEN Press Release — $390 Million Enforcement Action Against Capital One (January 15, 2021)