One of Israel's largest banks will pay $400 million to federal and state officials after admitting that it set up fake loans and corporations to help wealthy American clients stash their money abroad. Under terms of an agreement published Monday, Bank Leumi le-Israel will pay $270 million to the U.S. Justice Department and $130 million to the New York State Department of Financial Services (NYSDFS). The agreement bars the institution's Switzerland-based private bank and a Luxembourg subsidiary from providing banking and investment services to U.S. taxpayers. As part of the New York settlement, the Tel Aviv bank will ban its...
Not long ago, U.S. settlements in the hundreds of millions of dollars for violations of American law by a foreign bank seemed unlikely, if not out of the realm of possibility altogether. Then came the $780 million deferred prosecution agreement with UBS AG in 2009.
A $400 million settlement with an Israeli bank accused of facilitating tax evasion and an ongoing probe into loan fraud and AML violations at a Citigroup affiliate seemingly have little in common, but they share at least one trait: the exploitation of a typically low-risk, trade-finance instrument.
Although headline-grabbing settlements north of $1 billion have become the new normal for depository institutions operating in the United States, how those deals are impacting bank behavior is still unclear, at least for now, according to Brandon Garrett.
This time last December, one might reasonably have expected that 2014 would be a year of modest changes for the anti-money laundering and sanctions compliance sector. Then came JPMorgan Chase, BNP Paribas and a convoy of Russian tanks to quash that notion.
South Africa joined the bevy of countries that have signed onto FATCA, U.S. officials arrested 27 Mexican nationals for allegedly laundering money, and more, in this week's roundup.
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