FEBRUARY 11, 2011, 3:25 P.M. ET

http://online.wsj.com/article/BT-CO-20110211-711576.html

U.S. regulators fined a Zions Bancorp (ZION) subsidiary bank $8 million for deficiencies in its anti-money laundering controls Friday.

The Office of the Comptroller of the Currency levied the civil penalty against Zions First National Bank for violations of the Bank Secrecy Act and the USA Patriot Act.

In a statement, Zions Bank Chief Executive Scott Anderson said the company takes its compliance with federal laws and regulations very seriously and regrets the circumstances that led to the fine.

The OCC said the bank had developed a remote deposit capture product, which let customers to deposit items electronically from remote locations, and marketed the product to high-risk customers in 2006 and 2007 "without sufficient regard to" complying with banking secrecy and anti-money laundering rules. The OCC also said Zions First National Bank exited the foreign correspondent line of business in early 2008, voluntarily reviewed it and reported suspicious activity.

Anderson said that after Zions Bank identified the problem, it cooperated fully with regulators in investigating it.

"Additionally, over the past three years, we have employed considerable resources bank wide to significantly enhance our systems designed to detect and report potentially suspicious activities," he said Friday.

The Financial Crimes Enforcement Network--another Treasury agency, which specializes in battling money laundering--assessed another $8 million penalty against Zions concurrent with the OCCs, but a single $8 million payment to the U.S. Treasury will satisfy both.

John Walsh, acting comptroller of the currency said that the fines send "another strong message that banks need to be vigilant and ensure that they have effective anti-money laundering programs in place."

Zions Bancorp, the parent company, has posted quarterly losses for more than two years, as improvements in credit quality and loan-loss provisions have failed to reach a point of profitability, though it expects to return to the black this year.

Zions Bancorp shares were up 1.8% at $25.04 in recent trading.