Axiom Bank, of Maitland, Florida, will revamp its compliance with Bank Secrecy Act and anti-money laundering rules after the Office of the Comptroller of the Currency took issue with its controls and its lax suspicious activity reporting practices.
The $852 million-asset community bank is on the hook to create a new BSA/AML action plan and submit it to the regulator within 30 days of the October 3 agreement. Thereafter, within 30 days of the end of each quarter, Axiom must submit updates on its progress, according to the agreement.
Within 60 days of the agreement, Axiom was ordered to share with the OCC updated policies and procedures meant to control risks “associated with money laundering and terrorist financing and other illicit financial activity, with particular attention to the Bank’s pre-paid card and merchant processing partnership programs.”
The bank has also agreed to look back at its prior suspicious activity reports made between Jan. 1, 2023 and June 30, 2024 and to evaluate how it addresses third-party risks.
Axiom’s enforcement action comes one week after the OCC and other federal agencies hit TD Bank with more than $3 billion in fines and an asset cap on its U.S. operations. The penalties against TD followed a Justice Department investigation finding that criminals laundered hundreds of millions of dollars connected to illicit fentanyl through TD branches in New York and New Jersey.
Axiom’s enforcement action also follows a slew of enforcement actions handed down to banks as well as rulemaking efforts by regulators regarding third-party partnerships.
The bank, which was founded in 1984 as Washington Shores Savings Bank and rebranded as Axiom in 2014, has entered several fintech partnerships in the last couple of years. In 2022, Axiom partnered with open banking fintech Raisin to expand the reach of Axiom’s savings products; it's also the banking partner for immigrant-focused fintech Majority.
Last year, Axiom forged a relationship with Cable, a tech company that automates compliance testing for banks and fintechs.
“We take very seriously our responsibility to ensure our fintech partners maintain their compliance with regulatory requirements and expectations, including applicable financial crime obligations,” Aleem Jackson, Axiom’s senior former vice president and BSA/AML program head, said in a release issued at the onset of the Cable partnership.
Axiom and the OCC did not return requests for comment by press time.
No details were provided within the enforcement action of the violations that spurred it.
