US Government Cracks Down on Money Laundering in Andorra
Designation of Banca Privada d’Andorra (BPA) as a Foreign Financial Institution of Primary Money Laundering Concern
The US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has designated BPA as a foreign financial institution of primary money laundering concern in a significant move to combat global money laundering. The designation is based on evidence that high-level managers at BPA knowingly facilitated transactions for third-party money launderers acting on behalf of transnational criminal organizations.
BPA’s Compromised Practices
According to FinCEN, BPA’s corrupt high-level managers and weak anti-money laundering controls have made the bank an easy vehicle for third-party money launderers to funnel proceeds of organized crime, corruption, and human trafficking through the US financial system. The bank has processed hundreds of millions of dollars in transactions linked to Russian and Chinese criminals, foreign corruption, and other illicit activity.
Notable Cases
FinCEN’s action highlights three specific cases involving high-level managers at BPA who accepted bribes or payments from third-party money launderers:
- A manager provided assistance to Andrei Petrov, a Russian money launderer with ties to Semion Mogilevich, one of the FBI’s “Ten Most Wanted” fugitives.
- Another manager accepted exorbitant commissions to process transactions related to Venezuelan third-party money launderers who used shell companies and complex financial products to siphon off funds from Venezuela’s public oil company PDVSA.
- A third manager accepted bribes in exchange for processing bulk cash transfers for Gao Ping, a Chinese money launderer with ties to a transnational criminal organization involved in trade-based money laundering and human trafficking.
US Authorities Unite Against Money Laundering
The designation of BPA as a foreign financial institution of primary money laundering concern is part of a broader effort by US authorities to combat money laundering. FinCEN’s action was coordinated with the Department of Justice, U.S. Attorney’s Office for the Eastern District of Texas, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), and the Internal Revenue Service (IRS) Criminal Investigation.
International Cooperation
FinCEN Director Jennifer Shasky Calvery praised the contributions of Andorran authorities in this investigation and appreciated their commitment to investigating this activity fully. The action also highlights the importance of international cooperation in combating money laundering, with FinCEN recognizing the efforts of Mexican authorities in joint efforts to combat money laundering.
Impact on Financial Institutions
The designation of BPA as a foreign financial institution of primary money laundering concern will have significant implications for US financial institutions that do business with BPA. Under Section 311 of the USA PATRIOT Act, covered U.S. financial institutions may be prohibited from opening or maintaining correspondent or payable-through accounts for BPA, and other similar institutions.
This designation serves as a warning to financial institutions worldwide that money laundering will not be tolerated, and those found complicit in such activities will face severe consequences. The US government’s commitment to combating global money laundering sends a clear message that international cooperation is essential in protecting the integrity of the global financial system.