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U.S. Financial Institutions Falling Short in AML Efforts, Says Arizona Prosecutor
printThe implementation of U.S. dollar deposit limits at Mexican financial institutions has sparked an influx of cash deposits into U.S. banks, who are failing to properly scrutinize the funds, according to Cameron Holmes, a senior litigation counsel in the Arizona Attorney General's office. Money transmitters "offer an even more advantageous structure to money launderers because the two jobs that have to be accomplished are starting with cash in one location and sending the cash to another, and changing U.S. dollars into pesos," said Holmes, who is also director of the Southwest Border Anti-Money Laundering Alliance, a coalition of several state...
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One of the world's largest money services businesses is in danger of criminal indictment for failing to meet the terms of a 2010 settlement with the state of Arizona, say sources.
The New Mexico Attorney General's Office has expanded its team of anti-money laundering investigators as a result of a 2010 settlement between the state of Arizona and Western Union, according to the state's top prosecutor.
Unscrupulous financial institutions, legislative delays and a lack of quick action by U.S. federal officials are allowing drug cartels to wash money in the United States "right before our eyes," according to Terry Goddard, the former Attorney General of Arizona.
When the DOJ accused 14 in June of washing Mexican cartel money via a horse racing operation, it signified a rare feat in the drug war: a prosecution built solely on money laundering charges. Despite years of trying to choke the cash networks of Mexicans drug gangs, such cases remain the exception.
A 2010 agreement by Western Union to share data with Arizona and other Southwestern states is the catalyst for a major AML prosecution that came to light Thursday.
An agreement by one the nation's largest money transmitters to better share transactional data with investigators has resulted in greater scrutiny, both for the business and its chief competitor.
Federal examiners have asked at least a dozen banks along the U.S.-Mexico border to file suspicious activity reports even for relatively small transactions deemed only to be "unusual," say compliance professionals.
State prosecutors along the U.S.-Mexico border are studying whether drug traffickers are acting as subagents for Mexican banks that front payments on behalf of American money services businesses.
The U.S. Justice Department is investigating possible anti-money laundering compliance infractions related to how MoneyGram oversees agents working near Mexico's border, say current and former government sources.
Western Union will pay $94 million to resolve claims by the Arizona Attorney General's office that the company wasn't doing enough to combat Mexican money launderers and human traffickers.
Arizona investigators are free to seize Western Union money transfers believed to be tied to human smuggling operations, even when the transfers originated from other states, a state court said.
The U.S. Treasurys Financial Crimes Enforcement Network has imposed a $3 million penalty on Western Union for widespread currency transaction and suspicious activity reporting failures under the Bank Secrecy Act.
New York's Banking Department accused Western Union Financial Services Inc., the world's largest money-transfer company, of violations of federal and state laws designed to stop terrorist financing.