http://money.cnn.com/2018/02/08/news/rabobank-mexico-drug-money-laundering/index.html
A
European bank has been caught laundering money for the Mexican drug trade, and
trying to cover it up.
Rabobank
has been fined $369 million by the U.S. government after admitting it handled
millions in illicit funds.
The
Dutch bank allowed hundreds of millions of dollars in 'untraceable
cash' to be deposited at its rural bank branches in California and then
withdrawn via wire transfers, checks, and cash transactions, the Department of
Justice (DOJ) said in a statement on Wednesday.
The
bank also pleaded guilty to obstructing the investigation in an attempt to
avoid the repeat of sanctions it received in 2006 and 2008 for 'nearly
identical failures,' the DOJ added.
'When
Rabobank learned that substantial numbers of its customers' transactions were
indicative of international narcotics trafficking, organized crime, and money
laundering activities, it chose to look the other way and to cover up
deficiencies in its anti-money laundering program,' Acting Assistant
Attorney General John Cronan said.
Rabobank
CEO Wiebe Draijer said the 'violations that took place are serious,
regrettable and unacceptable.'
The
Rabobank fine comes less than six years after HSBC (HSBC) agreed to pay $1.92
billion to settle a similar case.
The
DOJ and U.S. Treasury said in 2012 that HSBC allowed the most notorious
international drug cartels to launder billions of dollars across borders and
violated U.S. sanctions for years by illegally conducting transactions on
behalf of customers in Iran, Libya, Cuba, Sudan and Burma.
In
the Rabobank case, executives were accused by the DOJ of coming up with a
series of measures to prevent the investigation of suspicious transactions,
customers and accounts.
One
such step was creating a list of 'verified' customers whose
transactions were not subject to additional reviews, even if they generated internal
alerts.
That
'verified list' ballooned to more than 1,000 customers by 2012, from
just 10 in 2009, the DOJ said.
The
DOJ also described how the bank's Calexico branch, located about two blocks
from the U.S.-Mexico border, was the bank's 'highest performing'
branch in the region because of the high level of cash deposits from Mexico.
Rabobank
said it cooperated fully with authorities investigating the events that took
place before 2014 and has made 'very strong efforts to strengthen its
internal controls and risk management functions, which is also recognized by
the authorities.'
A
former Rabobank vice president, George Martin, entered into a deferred
prosecution agreement with the U.S. concerning his role in the case, according
to the DOJ. He admitted -- in a federal court in San Diego in December -- to
playing a role in setting up the policies that prevented additional controls.
The
bank will also have to pay a $50 million penalty to the Office of the
Comptroller of the Currency.