Financial Regulatory Forum

U.S. agents scramble to grasp how Mexican cartels launder money via L.A. fashion district

Federal agents hope documents and electronic data seized during raids on the Los Angeles fashion district last month and cash-transaction reports that businesses in the zone are now required to file will help clarify how Mexico’s drug cartels are using international trade to launder money, law enforcement sources say.

The ability to generate new intelligence from documents and human sources may well dictate – at least in the short term – the degree to which U.S. authorities can effectively combat Mexican cartels by hitting them in their pocketbooks.  (more…)

Former MoneyGram compliance chief facing potential record fine regarded as anti-laundering innovator

In the late 1990s former MoneyGram International Inc executive Thomas Haider was a compliance leader pushing the money transfer industry to do more to fight financial crime, convincing his and other firms to voluntarily police transactions for illicit activity and report to authorities, a former official with the Treasury Department’s anti-money laundering bureau says.

A decade and a half later, six years after Haider left his post as MoneyGram’s compliance chief, Treasury’s Financial Crimes Enforcement Network (FinCEN) has threatened him with an unprecedented, multi-million dollar civil penalty. It has said he is personally liable for the money transfer giant’s failures to do what was required under the Bank Secrecy Act (BSA), the U.S. anti-money laundering (AML) law, to keep criminals out of the U.S. financial system during the mid-to-late 2000s, sources say. (more…)

Exclusive: U.S. Treasury unit seeks to resolve suit challenging Patriot Act power over foreign banks

By Brett Wolf, Compliance Complete

NEW YORK, June 3, 2014 (Thomson Reuters Accelus) - The U.S. Treasury Department’s anti-money laundering arm is quietly attempting to resolve a lawsuit challenging its use of a potent Patriot Act power against a Macau bank as well as the constitutionality of that authority, documents filed in federal court in Washington suggest.
The effort by Treasury’s Financial Crimes Enforcement Network (FinCEN) to avoid litigating the lawsuit brought by Banco Delta Asia (BDA) suggests the bureau is hoping to avoid a court battle that could weaken or perhaps even kill the extraterritorial power prized by U.S. authorities, Section 311 of the Patriot Act, former Treasury officials say.  (more…)

In bid to punish individual, FinCEN pursued MoneyGram business leaders, but caught compliance chief – source

By Brett Wolf, Compliance Complete

NEW YORK, May 20, 2014 (Thomson Reuters Accelus) - Although investigators with Treasury’s anti-money laundering unit tried to identify a senior business leader at MoneyGram International Inc who could be penalized over the money transfer giant’s admitted compliance failures, available evidence left them only one viable target – the firm’s former chief compliance officer, a former official with firsthand knowledge of the investigation said.

The push by Treasury’s Financial Crimes Enforcement Network (FinCEN) to send a stern message to the financial services community by targeting one of its own with a large fine began roughly a year and a half ago due to pressure from Capitol Hill. FinCEN investigators eyed a number of current and former MoneyGram employees, but found that senior business leaders had not left an evidence trail to follow. (more…)

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