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Date: April 30, 2024 Tue
Time: 1:25 am
Time: 1:25 am
Results for money laundering (u.s.)
2 results foundAuthor: U.S. Senate. Committee on Homeland Security and Governmental Affairs. Permanent Subcommittee on Investigations Title: U.S. Vulnerabilities to Money Laundering, Drugs, and Terrorist Financing: HSBC Case History Summary: This hearing examined the money laundering, drug trafficking, and terrorist financing risks created in the United States when a global bank uses its U.S. affiliate to provide U.S. dollars and access to the U.S. financial system to a network of high risk affiliates, high risk correspondent banks, and high risk clients. The hearing focused on a case study involving HSBC, one of the largest banks in the world. Headquartered in London, HSBC has a network of over 7,200 offices in more than 80 countries, 300,000 employees, and 2011 profits of nearly $22 billion. HSBC has been among the most active banks in Asia, the Middle East, and Africa. It first acquired a U.S. presence in the 1980s; today its leading U.S. affiliate is HSBC Bank USA, known as HBUS. HBUS has more than 470 branches across the United States and 4 million customers. HBUS is the key U.S. nexus for the entire HSBC worldwide network. In 2008, it processed 600,000 wire transfers per week; in 2009, two-thirds of the U.S. dollar payments HBUS processed came from HSBC affiliates in other countries. One HSBC executive told us that a major reason why HSBC opened its U.S. bank was to provide its overseas clients with a gateway into the U.S. financial system. Add on top of that, HBUS’ history of weak anti-money laundering controls, and you have a recipe for trouble. In 2003, the Federal Reserve and New York State Banking Department took a formal enforcement action requiring HBUS to revamp its AML program. HBUS, which was then converting to a nationally chartered bank under the supervision of the Office of the Comptroller of the Currency, or OCC, made changes, but even before the OCC lifted the order in 2006, the bank’s AML program began deteriorating. In September 2010, the OCC issued a Supervisory Letter, 31-pages long, describing a long list of severe AML deficiencies, and followed in October 2010, with a Cease and Desist order requiring HBUS to revamp its AML program a second time. The OCC cited, among other problems, a massive backlog of unreviewed alerts identifying potentially suspicious activity; a failure to monitor $60 trillion in wire transfers and account activity; a failure to examine risks at HSBC’s overseas affiliates before providing them correspondent banking services; and a failure, over a three-year period, to conduct anti-money laundering checks on more than $15 billion in bulk-cash transactions with those same affiliates. To examine the issues, the Subcommittee issued subpoenas, reviewed more than 1.4 million documents, and conducted extensive interviews with HSBC officials from around the world, as well as officials at other banks, and with federal regulators. HSBC has cooperated fully with the investigation. The Subcommittee’s work identified five key areas of vulnerability exposed by the HSBC case history. The five areas involve: •Providing U.S. correspondent accounts to high risk HSBC affiliates without performing due diligence, including a Mexican affiliate with unreliable AML controls; •Failing to stop deceptive conduct by HSBC affiliates to circumvent a screening device designed to block transactions by terrorists, drug kingpins and rogue nations like Iran; •Providing bank accounts to overseas banks with links to terrorist financing; •Clearing hundreds of millions of dollars in bulk U.S. dollar travelers cheques, despite suspicious circumstances; and •Offering bearer-share accounts, a high risk account that invites wrongdoing by facilitating hidden corporate ownership. Details: Washington, DC: Permanent Subcommittee on Investigations, 2012. 340p. Source: Internet Resource: Accessed August 27, 2012 at: www.hsgac.senate.gov/subcommittees/investigations Year: 2012 Country: United States URL: Shelf Number: 126117 Keywords: Banking IndustryDrug TraffickingMoney Laundering (U.S.)Terrorist Financing |
Author: U.S. Congress. Senate Caucus on International Narcotics Control Title: The Buck Stops Here: Improving U.S. Anti-Money Laundering Practices Summary: A bipartisan report entitled The Buck Stops Here: Improving U.S. Anti-Money Laundering Practices that provides recommendations for Congress and the Obama Administration to strengthen anti-money laundering laws and regulations in the United States. “Drug traffickers are motivated by one thing: money. The illicit proceeds from their crimes are blood money, and blood money has no place in our financial system.” said Senator Feinstein. “Money laundering—very often through U.S. businesses and financial institutions—must be stopped if we are to make real progress in curtailing the drug trade. Improving our anti-money laundering laws will help better combat transnational organized crime and return revenue to the U.S. Treasury.” “Our report has common-sense recommendations to curb key shortcomings in anti-money laundering statutes and enforcement practices.” said Senator Grassley. “By cutting off financing, we can get at the criminals who misuse legitimate institutions to fuel their illegal activities. Congress and the Obama Administration should take a close look at these recommendations.” The report recommends: •Stronger enforcement of anti-money laundering laws by the Justice Department, particularly in cases where banks are accused of improperly monitoring billions of dollars in illicit proceeds; •Making pre-paid cards (known as stored value) subject to cross-border reporting requirements; •Closing a loophole that makes armored cash carriers exempt from reporting requirements; •Passage of the Incorporation Transparency and Law Enforcement Assistance Act to make it more difficult for criminal organizations to hide behind shell companies; •Passage of the Combating Money Laundering, Terrorist Financing and Counterfeiting Act to close gaps in anti-money laundering laws; and •Enforcement of the 2007 National Money Laundering Strategy, including the requirement that all money service businesses register with the Treasury Department’s Financial Crimes Enforcement Network. Details: Washington, DC: Senate Caucus on International Narcotics Control, 2013. 49p. Source: Internet Resource: Accessed May 1, 2013 at: http://www.feinstein.senate.gov/public/index.cfm/files/serve/?File_id=311e974a-feb6-48e6-b302-0769f16185ee Year: 2013 Country: United States URL: http://www.feinstein.senate.gov/public/index.cfm/files/serve/?File_id=311e974a-feb6-48e6-b302-0769f16185ee Shelf Number: 128503 Keywords: Drug TraffickingFinancial CrimesMoney Laundering (U.S.)Organized Crime |