Financial Crime World

Puerto Rico Banking Entity Hit with $15 Million Fine for Failure to Implement Adequate Anti-Money Laundering Measures

The Financial Crimes Enforcement Network (FinCEN) has imposed a civil money penalty of $15 million on Bancrédito International Bank and Trust Corporation, an international banking entity operating in Puerto Rico. The bank was found to have repeatedly failed to implement adequate anti-money laundering (AML) measures, putting it at risk of being exploited by criminal organizations.

Background

Bancrédito provides banking services to customers in Venezuela and Florida, among other places. However, the bank has been under scrutiny for its lack of compliance with the Bank Secrecy Act (BSA) and Puerto Rico law. The BSA requires international banking entities like Bancrédito to:

  • Identify and report suspicious transactions related to possible violations of law or regulation
  • Implement due diligence programs for correspondent accounts

Failures and Consequences

Despite being required to do so, Bancrédito failed to establish an AML program and did not report suspicious transactions. The bank was previously placed under receivership in 2023 by the Office of the Commissioner of Financial Institutions of Puerto Rico (OCIF) after a series of examinations revealed repeated deficiencies and violations.

The following is a timeline of Bancrédito’s failures:

  • 2010: Failures first identified
  • 2012: Subsequent examination reveals additional BSA deficiencies and violations
  • 2014: Further examination reveals continued AML program deficiencies
  • 2015: Bank enters into consent order with OCIF, agreeing to remedy its failures and violations
  • 2017 and 2019: Additional examinations reveal continued AML program deficiencies

Consequences of Failure

As a result of its failures, Bancrédito has agreed to:

  • Surrender its international banking entity license
  • Not seek to obtain a new banking license

The bank’s failure to implement adequate AML measures puts it at risk of being exploited by criminal organizations and undermines the integrity of the financial system.