The U.S. government's landmark case against HSBC Holdings Plc for knowingly turning a blind eye to financial crime is seemingly fated to end much as it began: complex and messy.
For money transmitters, proving to a bank that your company isn't too big of an anti-money laundering risk to take on can be difficult, even more so when you've encountered compliance problems.
We never said compliance professionals had it easy, and 2010 doesn't look to be a year when things will be any better for the anti-money laundering and counterterrorism financing industry.
AML-related enforcement actions issued by the OCC have more than halved since 2005, from 32 actions in 2005 to 12 during the first three quarters of 2007, as the number of terminated actions have more than double in the same period, Dan Stipano, the agency's deputy chief counsel, said.
The bank will forfeit $21.6 million in a deferred prosecution agreement with the U.S. Justice Department and pay a $10 million penalty for failing to adequately monitor a Mexican money transfer business that moved millions of dollars in illegal drug proceeds through the bank.
Facing possible regulatory sanctions for continued compliance deficiencies, Union Bank of California has created the new position of chief risk officer responsible for overseeing anti-money laundering and risk compliance reporting companywide.
The Financial Services Agency ordered Bank of Tokyo to improve its New York branchs policies for identifying politically exposed persons, correspondent accountholders and other high-risk customers, including those who conduct frequent wire transactions.
The Federal Reserve and New York State Banking Department entered into a written agreement with Sumitomo Mitsui Banking Corp. on Wednesday ordering its New York branch to improve Bank Secrecy Act compliance deficiencies a month after another Japanese bank was cited for risk management deficiencies.
While smaller banks received civil money penalties in 2006, the size of the fines relative to bank size increased.
The Federal Deposit Insurance Corporation (FDIC) and the New York State Banking Department reprimanded the Bank of Tokyo's Mitsubishi UFJ Trust Company on Monday for "unsafe and unsound" practices in its New York branch.
U.S. regulators believe Mitsubishi UFJ Financial Group branches in New York didn't properly report suspicious money transfers and account openings, according to a report.