On January 31, 2024, the Office of the Comptroller of the Currency (OCC) fined City National Bank for engaging in unsafe or unsound practices, including its failure to establish effective risk management and internal controls.

The violations leading to the fine encompassed:

 •    Failure to establish effective risk management and internal controls
•    Limited adoption of BSA/AML and OFAC risk assessment methodologies
•    An ineffective KYC-CDD process followed by the bank
•    Lack of necessary skillset and resources in suspicious transaction detection, SAR reporting, and ongoing monitoring
•    Non-compliance with standards set by the OCC for large insured national banks, federal savings associations, and federal branches since December 31, 2020.
•     Violation of the Bank Secrecy Act and other regulations

The OCC issued a cease-and-desist order, mandating the bank to implement extensive corrective measures to enhance its strategic plan, operational risk management, compliance risk management (BSA/AML and fair lending), strategic risk management, and investment management practices.