Board of Directors Response

D

Option A: Terminate the compliance officer and staff This is not a recommended action to take when a financial institution receives a regulatory enforcement action due to deficiencies in its anti-money laundering program. Termination of the compliance officer and staff can be perceived as a sign of poor management and can also raise questions about the integrity of the institution's leadership. It is essential to identify the root cause of the deficiencies in the anti-money laundering program and take corrective actions.

Option B: Purchase and install a new suspicious activity monitoring system While this may be a good step in improving the institution's anti-money laundering program, it should not be the only action taken. Before purchasing and installing a new system, the institution should conduct an internal review to identify the deficiencies and gaps in the current program. The review will provide insights into the areas where improvements are required and help the institution choose an appropriate system that addresses its specific needs.

Option C: Hire an attorney with instructions to protest the enforcement action This is also not a recommended action to take when a financial institution receives a regulatory enforcement action. The institution should acknowledge the enforcement action and take appropriate steps to address the deficiencies identified by the regulators. The institution should cooperate with the regulators to demonstrate its commitment to addressing the issues and preventing future violations.

Option D: Instruct the compliance officer to develop a plan to remediate the institution's anti-money laundering program This is the recommended action for the board of directors to take when a financial institution receives a regulatory enforcement action due to deficiencies in its anti-money laundering program. The compliance officer should conduct a thorough review of the institution's program and identify areas where improvements are required. Based on the review, the compliance officer should develop a remediation plan that addresses the identified deficiencies and provides a roadmap for implementing the necessary changes. The board of directors should oversee the implementation of the remediation plan and ensure that the necessary resources are allocated to address the deficiencies. Additionally, the board should monitor the progress of the remediation efforts to ensure that the program is effective in preventing and detecting money laundering activities.