OCC issues Consent Order against Anchorage Digital Bank over AML violations

OCC issues Consent Order against Anchorage Digital Bank over AML violations

By Onose Enaholo - min read
Updated 26 January 2023

Anchorage Digital Bank has agreed to remedial action and will appoint a Bank Secrecy Act officer to help ensure compliance.

The Office of the Comptroller of the Currency (OCC), the United States national bank regulator, has issued a consent order against Anchorage Digital Bank, according to a news release published on Thursday, 21 April.

Anchorage Digital was the first digital asset bank to receive regulatory approval from the OCC. Granted in January 2021, the conditional approval to the company’s national trust charter application enabled it to change to Anchorage Digital Bank, National Association.

The OCC, however, says the formerly Anchorage Trust Company failed to implement the Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) requirements it had agreed to as part of the condition to operating as a federally regulated digital asset bank.

It’s Anchorage Digital’s failure to comply with the KYC and AML provisions that prompted the order, the OCC said in the release.

The OCC holds all nationally chartered banks to the same high standards, whether they engage in traditional or novel activities,” said Michael J. Hsu, the Acting Comptroller of the Currency.

When institutions fall short, we will take action and hold them accountable to ensure compliance with federal laws and regulations,” he added.

Anchorage Digital has started remedial action

As part of the remedial action necessitated by the order, Anchorage is required to appoint a compliance committee of not less than three members. It’s also to draw an action plan toward addressing all BSA deficiencies.

The bank has thirty (30) days from the date of the Consent Order to submit the action plan toward achieving and sustaining compliance with the relevant KYC and AML laws.

Anchorage has also agreed to hire a Bank Secrecy Act officer and provide all the necessary support for them to work towards compliance. Other than that, the bank will need to ensure higher customer due diligence, as well as customer risk identification checks, are in place.

The OCC noted in the order that Anchorage Digital has instituted “corrective action” and pledged to ensure full compliance.