News
American Express AML Case Offers Important Compliance Lessons, Consultants Say
By Brian Orsak
printMaybe it helps to put a pretty face on an ugly week. On Monday, the same day American Express Co. was ordered to pay the largest anti-money laundering related penalty assessed against a U.S. financial institution, the company said it had hired pop singer Beyonc?© Knowles to be its celebrity representative. But the bad news didn't end with that $65 million penalty: on Tuesday the company's American Express Bank Ltd. unit reached an agreement with the New York State Banking Department to improve its AML regime. That agreement requires the unit to improve its suspicious activity reporting and customer due...
TO READ THE FULL STORY
Subscribe
Learn More
Related News
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.
An ousted bank chairman's quest to win an apology from the U.S. Justice Department is raising questions about the power of federal prosecutors to dictate the firing of employees.
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.
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.
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.
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 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.
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 slated for publication in the July issue of Forbes.
The private banking unit is overseen by the company's Miami-based American Express Bank International, and has been plagued by anti-money laundering related regulatory trouble for more than a decade.
American Express Co. has set aside $60 million for regulatory and legal matters related to a U.S. Justice Department investigation of anti-money laundering compliance programs at its private banking operation.
The bank, which is based in the Netherlands, said Thursday that it has set aside €365 million in anticipation of the settlement of a Justice Department criminal probe into ABN's dollar clearing activities, Office of Foreign Assets Control (OFAC) sanctions compliance and other issues.
The panel, which gives the Treasury Department feedback on transaction reporting rules, will have 11 vacancies as of Feb. 28, FinCEN said.