Skip to main content

A U.S. regulator has fined a former private banker for Royal Bank of Canada US$100,000 and banned him from working for U.S. banks, alleging he illegally facilitated a series of transactions for high-risk clients in 2013.

Dirceu Magalhaes was a private-banking senior manager at an RBC office in Miami that has since been closed, which did business with clients in Latin American countries. The bank dismissed him late in 2013.

In a settlement, the Office of the Comptroller of the Currency found that Mr. Magalhaes violated laws and regulations through a pattern of intentional misconduct. He is now barred from participating “in any manner” in the affairs of banks, credit unions and regulators, according to the terms of a consent order dated Sept. 12.

Under the agreement, Mr. Magalhaes neither admits nor denies the OCC’s findings. He did not respond to a request for comment.

The transactions in question took place between January and November of 2013, and involved “high risk clients" residing in a “high risk jurisdiction,” according to the OCC.

Most of the transactions “had no known legal or business reason,” and “avoided record keeping," and Mr. Magalhaes personally gained about US$15,000 from them. The order further alleges that Mr. Magalhaes did not conduct proper due diligence, “withheld material information” from RBC’s branch, and “at times, actively concealed this information.”

An RBC spokesperson declined to comment.

The Miami office where Mr. Magalhaes worked was shuttered in 2015. Since then, RBC has largely pulled out of wealth management in the Caribbean and Latin America, due partly to concerns about anti-money-laundering controls. The bank had faced investigations in multiple countries, including Brazil, Uruguay and France, according to reporting by the Wall Street Journal.

But in the fall of 2017, RBC announced it would expand in the southeastern United States by establishing a retail brokerage office serving high net worth clients, under new management but in the same building as its prior operations.

Follow related authors and topics

Authors and topics you follow will be added to your personal news feed in Following.

Interact with The Globe