FINCEN Takes Aim at Financial Institutions in Battle Against Money Laundering
The US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has launched a series of high-profile enforcement actions against financial institutions accused of failing to comply with anti-money laundering (AML) regulations.
Recent Enforcement Actions
In recent weeks, FinCEN has taken action against several financial institutions for violating AML laws. The most notable example is the record-breaking $3.4 billion penalty imposed on Binance, the world’s largest virtual asset service provider, for violating US AML laws.
Binance Penalty
The enforcement action against Binance marked the largest in Treasury’s history and was the result of a collaborative effort with other federal agencies. This penalty serves as a warning to others in the financial industry to prioritize AML compliance.
Other Enforcement Actions
In addition to the Binance penalty, FinCEN has also taken action against:
- Kingdom Trust Company: Hit with a $1.5 million civil money penalty for failing to file suspicious activity reports (SARs) related to a trade-based money laundering scheme and multiple securities fraud schemes.
- Bancredito International Bank and Trust Corporation: Assessed a $15 million penalty for willful violations of the Bank Secrecy Act (BSA) and its implementing regulations. The bank processed millions of dollars in suspicious transactions without proper monitoring or reporting to FinCEN.
- Gyanendra Kumar Asre: A former BSA officer at a New York credit union, was hit with penalties for failing to register his own money services business (MSB) with FinCEN and for allowing hundreds of millions of dollars in high-risk funds to move through the credit union without proper monitoring or reporting.
Commitment to Protecting the US Financial System
According to Director Kenneth Blanco, these enforcement actions demonstrate FinCEN’s commitment to protecting the US financial system from the threat of money laundering. “We are taking aggressive action against financial institutions that fail to comply with AML regulations,” he said. “Our goal is to ensure that our financial system remains safe and secure for all Americans.”
Prioritizing AML Compliance
The penalties imposed on these institutions serve as a warning to others in the financial industry to prioritize AML compliance. Blanco emphasized that FinCEN will continue to work closely with law enforcement partners to identify and prosecute those who seek to undermine the financial system.
Ongoing Efforts
FinCEN is currently implementing the Corporate Transparency Act, which requires certain companies to disclose their beneficial ownership information to the government. The agency is also proposing new rules aimed at bringing transparency to the residential real estate and investment adviser industries.
“We are committed to using all available tools to protect our financial system from harm,” Blanco concluded. “We look forward to continuing to work with our partners in private industry and law enforcement to achieve this goal.”