On June 16, the Office of the Comptroller of the Currency (OCC) issued a cease and desist order against United Texas Bank, N.A. citing deficiencies in its Bank Secrecy Act/anti-money laundering (BSA/AML) compliance program that resulted in violations of law or regulation. The action is notable not only for its substance, but for its context. The order was issued as a condition of the bank’s conversion to a national bank charter supervised by the OCC.
Background
United Texas Bank was formerly a Texas state-chartered bank supervised by the Texas Department of Banking and a member of the Federal Reserve System. In August 2024, the bank consented to a cease and desist order with the Federal Reserve Bank of Dallas and the Texas Department of Banking (the 2024 Order) after examiners identified significant deficiencies in its foreign correspondent banking and virtual currency customer programs, specifically in risk management and compliance with the BSA, applicable Treasury regulations, and Federal Reserve Regulation H.
In November 2025, the bank filed an application with the OCC to convert to a national bank charter. The OCC approved the conversion in May 2026, but conditioned that approval on the bank entering into a new cease and desist order upon consummation of the conversion. The conversion was completed on June 12, 2026, and the OCC issued its order four days later.
What the Order Requires
The order carries forward the corrective action obligations of the 2024 Order under OCC supervision across five substantive areas:
Board Oversight The board must maintain and strengthen its oversight of BSA/AML and Office of Foreign Assets Control (OFAC) compliance, ensuring that compliance personnel have sufficient subject matter expertise, stature, and direct reporting access to the board, and that adequate resources and staffing levels are maintained and periodically re-evaluated.
BSA/AML Compliance Program The bank must continue implementing a revised BSA/AML compliance program that includes robust internal controls, a comprehensive risk assessment, enhanced independent testing, a fully empowered compliance officer with meaningful decision-making authority, and effective BSA training for all personnel, including targeted training for those with compliance responsibilities.
Customer Due Diligence (CDD) The bank must maintain an enhanced CDD program addressing customer identification and verification, source of wealth documentation, risk-based customer risk ratings, and ongoing periodic reviews of all account holders — with particular attention to customers posing heightened risk of illicit activity, including nested financial institutions and foreign shell banking activity.
Suspicious Activity Monitoring and Reporting The bank must sustain a revised transaction monitoring program with well-documented alert methodology, appropriate resource allocation for alert and case management, adequate escalation procedures, and periodic review and updating of monitoring rules and thresholds.
OFAC Compliance The bank must continue implementing enhanced OFAC screening procedures, an improved OFAC risk assessment methodology, and ongoing training tied to employee job responsibilities.
In addition, the board is required to submit written quarterly progress reports to the OCC’s Assistant Deputy Comptroller detailing the corrective actions taken under each article of the order and their current status.
Conclusion
The United Texas Bank cease and desist order illustrates the OCC’s willingness to condition charter approvals on continued compliance remediation and to maintain regulatory continuity across supervisory transitions. For financial institutions with active enforcement actions, or those considering a charter conversion, this action underscores the importance of resolving BSA/AML deficiencies fully and proactively, rather than simply managing them until a new supervisory relationship begins.