The Federal Reserve has ordered Citigroup Inc to better police for the risk of money laundering, part of a broad U.S. regulatory crackdown on the potential for illicit money flows. The Fed told Citigroup’s board to submit a plan within 60 days to improve its oversight of companywide anti-money laundering compliance, according to a consent order dated March 21, but only made public on Tuesday. The order expands upon similar orders directed at several Citigroup units in 2012. The plan should include funding personnel and resources based on the risks of different units – policies that instill a “proactive approach” to identifying and managing money-laundering risks – and measures to ensure employees adhere to those compliance policies, the Fed said. [Reuters]
money laundering
Fed Tells Citigroup To Try Harder When It Comes To Avoiding Aiding And Abetting Criminals
By Bess LevinStandard Chartered Chairman Misspoke When He Called Iranian Money-Laundering Business A ‘Clerical Error’
By Jon Shazar
Apparently, when you’ve accepted responsibility for laundering money for rogue states—and entered into a deferred-prosecution agreement—you can’t turn around and refer to said money-laundering as NBD. Duly noted. Read more »
The passing of the torch.
It’s not Venezuela, now that old Hugo is gone. It’s not Cuba. And it’s definitely not the U.S. Indeed, the ballsiest country on this side of the globe seems to be measuring its cojones against us, in a series of direct throw-downs. And Argentina’s are bigger. Read more »
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Expert: Hedge Funds Unlikely To Be Thrilled By Rule Requiring Them To Rat Out Employees Engaging In Securities Fraud, Other Criminal Activities On Their Watch
By Bess LevinU.S. financial regulators are pushing to turn hedge funds into informers on the white collar crime beat. The Financial Crimes Enforcement Network (FinCEN) is working on a rule that would require U.S. hedge funds to file formal reports notifying U.S. authorities of any suspicious trading by employees or outside parties, the regulatory agency said. The rule being crafted by FinCEN, part of the Treasury Department, would force the $2 trillion hedge fund industry to police itself in much the same way banks, brokerages and mutual funds are required to do by filing suspicious activity reports (SARs) with the unit. Steve Hudak, a FinCEN spokesman, said a proposed rule for the hedge fund industry could be filed for public comment some time in the first half of this year. But the rule, which would cover activities such as insider trading and money laundering, will force funds to spend more money on building out their compliance and legal departments. Hedge fund lawyer Ron Geffner said he expects many in the industry will oppose the new rule as being both intrusive and costly. [Reuters via Dealbook, FINalternatives]
So, HSBC is going to have to cough up almost $2 billion for, in effect, running a massive money-laundering operation that helped fund such luminary do-gooders as the Iranian government and Mexican drug gangs. But the U.S. has decided not to throw the cuffs on the British bank because, well, that would be pretty hard. And could create an awful lot of collateral damage that no one needs as the country careens off the fiscal cliff. Read more »
Standard Chartered Plc has agreed to pay $340 million to settle allegations that it hid transactions with Iran from regulators, the New York Department of Financial Services said on Tuesday. In addition to the civil penalty, the bank agreed to install a monitor for at least two years to evaluate the bank’s money-laundering risk controls in its New York branch, the department said in a statement. [Reuters]
If she has to, she has to.
So give it up for them says the bank’s chief economist. Read more »
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