Financial Risk Manager Part 2

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Explanation:

In 2022, USAA Federal Savings Bank was fined $140 million by the Financial Crimes Enforcement Network (FinCEN) and the Office of the Comptroller of the Currency (OCC) due to significant failures in its Anti-Money Laundering (AML) program. Regulators fined the bank for willfully failing to implement and maintain an adequate AML program that met the requirements of the Bank Secrecy Act and specifically failing to timely correct deficiencies previously identified. Option A refers to Wells Fargo, while Options C and D relate to different historical banking scandals.

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Question A risk consultant is meeting with the senior management of a midsize bank to discuss ways in which the bank can improve its management of financial crime and fraud risk. During the meeting, the consultant uses the example of USAA Bank to explain how weaknesses in controls and processes used to manage these risks can result in large losses as well as regulatory fines. Which of the following best explains the fine imposed by regulators on USAA Bank?

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Last updated: July 5, 2026 at 07:28

USAA Bank was fined after many retail bankers were found to have opened unwanted accounts for existing customers in order to meet performance incentives.

USAA Bank was fined for failing to correct deficiencies identified by regulators in its management and reporting of suspicious transactions after an extended period of time.

USAA Bank was fined after several subsidiaries were found to have laundered over USD 1 billion in funds belonging to large criminal organizations.

USAA Bank was fined after fraudulently marketing complex interest rate derivatives to large municipal clients by significantly understating their risk.