Federal regulators have fined Wealth One Bank $676,500 for not complying with anti-money laundering regulations.
The March 6 announcement from the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) shortly follows a Globe and Mail report that the bank's founders may be susceptible to Chinese government coercion and money laundering.
Wealth One is one of 34 chartered domestic banks with retail offices in Toronto and Vancouver. The bank was licensed in 2016 and markets itself to Chinese-speaking immigrant clients.
The ceremonial opening on Sept. 16, 2016, in Vancouver, was celebrated by now-former 小蓝视频 Premier Christy Clark and now former Chinese Consul General of Vancouver Fei Liu.
FINTRAC imposed the administrative penalty on Feb. 15, stating Wealth One Bank of Canada was found to have committed various administrative violations, including failing to develop compliance policies and procedures such as ongoing monitoring of business relationships and record-keeping, as well as failing to "assess and document the money laundering or terrorist activity financing risks of its geographic locations."
FINTRAC also found Wealth One failed to submit suspicious transaction reports "where there were reasonable grounds to suspect that transactions were related to a money laundering offence."
FINTRAC notes, however, "these administrative deficiencies are not related to money laundering or terrorist financing offences," and the bank has paid the penalty in full.
The bank issued a statement on March 6 to address the FINTRAC findings and media reports that Canada's Minister of Finance, Chrystia Freeland, had expressed concerns about national security to the bank via a letter.
"The Bank works closely with regulators and has an ongoing program for enhancing and strengthening our compliance programs. Any issues identified are immediately addressed, including those identified by FINTRAC," said bank president and CEO Paul Leonard.
"The bank takes these matters very seriously and addresses them through continuous improvements and in the normal course of its engagement with the regulators," added Leonard.
"To be clear, this has nothing to do with money laundering, and any allegation that the bank, or anyone who works here, may be involved in money laundering is completely unfounded," said Leonard.
"WealthONE's board of directors retained external professionals to conduct extensive reviews of the bank's operations, and the conclusion from multiple assessments was clear – WealthONE is operating in a manner consistent with expectations of a Canadian bank in our highly regulated, compliance-focused industry."
