News
DEA Probe Links Colombian Narcotics Operation to American Express Unit, Forbes Reports
By Brian Orsak
printA Drug Enforcement Administration investigation has connected American Express Cos. to a Colombian drug and money laundering operation, Forbes reported on its website. A senior DEA official confirmed that the agency is investigating the company's Miami-based private banking unit and said the case involves money laundering schemes known as black market peso exchanges, according to a report in the July issue of Forbes. The announcement follows an April 19 disclosure in company earnings report that American Express had set aside $60 million for regulatory legal matters relating to a U.S. Justice Department investigation of the anti-money laundering compliance program of...
TO READ THE FULL STORY
Related News
High-profile sanctions cases are spurring large banks and third-party software vendors to improve how they identify when counterparts and clients secretly act on behalf of blacklisted entities, say compliance experts.
Crackdowns on currency exchange and bond swap businesses in Mexico and Venezuela are prompting some U.S. banks to turn away secondary market businesses in Latin America even when they operate legitimately, say consultants.
The U.S. Justice Department has issued a rare letter exculpating a former top American Express banker fired in the wake of a multimillion-dollar anti-money laundering deferred prosecution agreement reached in August 2007.
Venezuela's takeover of at least 30 bond brokerages on money laundering charges will do little to stem the tide of illicit proceeds flowing into the country, say analysts.
The Royal Bank of Scotland will pay the United States $500 million over Bank Secrecy Act and sanctions violations committed by the now defunct ABN Amro, U.S. officials said Monday.
A Milwaukee-based company sues American Express for failing to block illegal transactions and Royal Bank of Scotland discloses that the U.K. Financial Services Authority is investigating it, in this week's news roundup.
A former American Express compliance officer is facing an uphill battle in his efforts to win $7.5 million from the bank and an apology from the U.S. Justice Department, say lawyers.
Africa is fast becoming one of the world's largest hubs for smuggling cocaine, heroin and prescription drugs from South America and Asia into Europe and the United States, according to a United Nations watchdog group.
A group of 90 American, Israeli and Canadian citizens are suing American Express Bank and Lebanese Canadian Bank for $650 million, alleging the institutions provided financial services to blacklisted terror group Hizbollah.
Financial institutions are struggling to determine how to comply with a federal ban on "facilitating" companies and individuals that do business with OFAC sanctioned countries, say compliance experts.
The Republic of the Netherlands must improve communication between agencies that investigate money laundering and terrorist financing and make better use of the suspicious transaction reporting information provided by financial institutions, according to a government audit report released Tuesday.
Rick Small, head of global compliance at GE Money, joins American Express Co. this month as vice president of anti-money laundering and sanctions risk management. Separately, Wachovia Bank has hired Dan Soto, former chief compliance officer at RBC Centura, to head its AML efforts.
Two Venezuelan businessmen accused by U.S. prosecutors of acting as clandestine agents for Hugo Chavez's government have dropped a lawsuit against American Express Bank International related to $25 million the men had placed with the bank.
Banks seeking to acquire other financial institutions must carefully absorb, analyze and monitor the customer information and transaction history of its target not only to ensure it is paying a fair price but also to protect itself against possible regulatory trouble down the road.
The $1.1 billion sale to U.K. bank Standard Chartered PLC follows enforcement actions issued in August requiring American Express Bank Ltd., the American Express private banking subsidiary, to pay $65 million in penalties and acknowledge its responsibility for AML and Bank Secrecy Act failures.
The biggest challenge banking compliance departments face is the internal struggle for adequate resources and attention from senior management, says Markus Schulz, chief operating officer of the anti-money laundering compliance department for ABN AMRO in the Netherlands.
But the bad news continued this week for the company as its American Express Bank Ltd. unit reached an agreement on Tuesday with the New York State Banking Department to improve its AML regime.
The penalty, the largest against a U.S. institution for AML violations, resulted from a four-year investigation of a Colombian narcotics and money laundering operation.
The bill would prohibit using more than $10,000 in funds "legitimate or otherwise" to facilitate so-called specified unlawful activities, crimes used to establish money laundering cases.
In a letter sent to SEC Chairman Christopher Cox on Thursday, Frank, chairman of the House Financial Services Committee, said the list unfairly includes companies that have divested, or have negligible business dealings, in these countries.