The Federal Reserve on Tuesday terminated a cease-and-desist order issued last year against Bank of New York Mellon for misstating the collateral it pledged to a government lending program in 2008.
The order was terminated after BNY Mellon met compliance requirements that had been mandated by the Fed when it fined the firm $6 million in the April 2012 order, according to the Federal Reserve. The requirements included submitting a plan to the Fed to improve BNY Mellon's procedures and to step up training for its employees. BNY Mellon paid the fine.
According to the original enforcement action the Fed issued, a portion of the collateral the bank pledged to the Fed's Boston bank was ineligible for the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility, a program set up to help ease the credit squeeze during the financial crisis. As a result, BNY Mellon received more in loans than it should have, according to the statement.
A Fed spokesman confirmed the order termination. Kevin Heine, BNY Mellon spokesman, said the firm had no comment.
