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On March 4, 2020, the Financial Crimes Enforcement Network (FinCEN) of the US Treasury Department imposed a $450,000 civil money penalty against the former chief operational risk officer at US Bank National Association (US Bank), for his alleged role in failing to prevent violations of US anti-money laundering (AML) laws and regulations that occurred during his tenure.

FinCEN’s unprecedented individual enforcement action is the latest sign that US AML regulators intend to hold individual executives accountable for their roles in financial institutions’ violations of law. It serves as a reminder of the importance of strengthening compliance programs in order to minimize the likelihood of findings of individual liability. Meanwhile, authorities outside the United States, including in the UK, are increasingly focused on AML failings and individuals potentially liable for those failings.


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On 5 February 2020, the UK Court of Appeal dismissed a challenge to the UK’s first Unexplained Wealth Order (UWO). Mrs. Zamira Hajiyeva, wife of the former chair of the International Bank of Azerbaijan who was sentenced to 15 years in jail in 2016 for defrauding the bank out of £2.2 billion, launched a challenge against the UK National Crime Agency’s (NCA) first ever UWO, attempting to overturn the UWO against a property in Knightsbridge, London, purchased for £11.5 million. Her arguments that the NCA mischaracterized her husband’s status as a politically exposed person (PEP) and that her husband’s conviction was the result of a “grossly unfair trial” were rejected by the Court of Appeal. This decision will likely energise and provide a boost to the NCA and other law enforcement agencies in seeking UWOs to seize ill-gotten gains in the future.

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On October 11, the leaders of the Commodities Futures Trading Commission (CFTC), Financial Crimes Enforcement Network (FinCEN), and the Securities and Exchange Commission (SEC) issued a joint statement regarding anti-money laundering (AML) compliance for persons engaged in certain activities involving digital assets.  While the statement largely reaffirms known agency guidance and existing regulations, it is noteworthy for a number of reasons.

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On May 9, 2019, the US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) published long-awaited guidance addressing how FinCEN regulations apply to what the agency calls “convertible virtual currency” (CVC), which covers most types of cryptocurrencies and crypto-tokens. The guidance focuses on:

  • Platforms engaged in exchange transactions involving securities, commodities, or futures contracts and fiat currency, CVC, or other value that substitute for currency;
  • Natural persons providing CVC money transmission as person-to-person (P2P) exchangers;
  • CVC wallets (differentiating among hosted, unhosted, and multiple signature wallet providers);
  • CVC provided through electronic terminals, kiosks, or automated teller machines;
  • CVC services provided through decentralized (software) applications (DApps), including anonymizing services;
  • Payment processing services;
  • Internet casinos;
  • Initial Coin Offerings (ICOs) and the status of creators of CVC;
  • DApp developers, users conducting financial activities, and DApps conducting CVC transactions; and
  • Mining pools and cloud miners.


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On February 13, the European Commission adopted a new list of “high-risk” jurisdictions that the Commission identified as posing significant threats to the European Union’s financial system as a result of strategic deficiencies in their anti-money laundering and counter-terrorism financing (AML/CFT) frameworks.  In addition to countries like North Korea, Iran, and Syria, the list also includes four US territories.  In response, the US Department of Treasury expressed “significant concerns about the substance of the list,” which diverges from the list published by the Financial Action Task Force (FATF), as well as the “flawed process” by which the list was developed.  As a result of the new list, banks in the EU will be required to exercise enhanced due diligence when dealing with customers and financial institutions from the listed countries and territories.

According to the Commission, the new list reflects the broadened criteria for the identification of high-risk jurisdictions under the EU’s Fifth Anti-Money Laundering Directive, which now includes “the availability of information on the beneficial owners of companies and legal arrangements” including trusts.  In creating this list, the Commission “developed its own methodology to identify high-risk countries, which relies on information from the Financial Action Task Force, complemented by its own expertise and other sources such as Europol.”  EU Justice Commissioner Věra Jourová stated that the list is aimed at ensuring that “dirty money from other countries does not find its way [into the EU’s] financial system,” and urged the listed countries “to remedy their deficiencies swiftly.”
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On December 17, 2018, the Financial Crimes Enforcement Network (“FinCEN”) announced that UBS Financial Services, Inc. (“UBS”) had entered into a consent agreement to resolve violations of the Bank Secrecy Act (BSA). UBS is a global firm providing financial services in over 50 countries, including the US  As part of this agreement, UBS will pay $14.5 million in civil penalties to US regulators — $5 million of which will be paid to the US Department of the Treasury, while the remainder will be made concurrent with penalties imposed by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

According to FinCEN, UBS willfully violated anti-money laundering (AML) program requirements and failed to conduct ongoing due diligence on correspondent accounts for foreign financial institutions for more than a decade. Violations included: failure to develop and implement an appropriate risk-based AML program that adequately addressed the risks associated with accounts that included both traditional brokerage and banking-like services; failure to implement appropriate policies and procedures to ensure the detection and reporting of suspicious activity; failure to hire and retain sufficient AML compliance staff to meet its obligations under the BSA, resulting in a backlog of cases that hindered UBS’s ability to investigate and report suspicious activity;  and failure to adequately monitor foreign currency-denominated wire transfers conducted through commodities accounts and retail brokerage accounts.  These practices violated UBS’s obligations as a brokerage firm providing bank-like services to develop and implement an adequate AML program.
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The FinCEN Customer Due Diligence Requirements for Financial Institutions, known as the CDD Rule or the “Fifth Pillar,” becomes effective today for certain covered US Financial Institutions.  This CDD Rule, which amends US Bank Secrecy Act regulations, seeks to improve financial transparency and prevent money laundering/terrorist financing.  The CDD Rule applies to covered US

The US Department of Justice (DOJ) and federal financial regulators announced major public enforcement actions against two large banks with significant international business dealings in February. These enforcement actions resulted in a guilty plea, a deferred prosecution agreement (DPA), and near-record fines and penalties. Both financial institutions failed to comply with Bank Secrecy Act/Anti-Money Laundering

A series of recent federal enforcement actions targeting weaknesses in Bank Secrecy Act/anti-money laundering (BSA/AML) compliance programs continued on March 16, when US Gold refinery Elemetal LLC, based in Dallas, Texas, pled guilty in US District Court for the Southern District of Florida to a single-count information charging failure to maintain an adequate BSA/AML program.

Elemental admitted that from August 2012 through November 2016, it purchased and refined billions of dollars of gold from countries around the world, but willfully failed to develop, implement, and maintain an adequate BSA/AML compliance program, despite the high risk of gold-based money laundering.  The international gold trade is recognized as a common method for laundering illegally mined gold, narcotics and other criminal proceeds.

Federal prosecutors alleged and Elemetal admitted that they had:
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On February 13, 2018, the US Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a Notice of Proposed Rulemaking (NPRM), pursuant to Section 311 of the PATRIOT Act, seeking to prohibit the opening or maintaining of a correspondent account in the United States for, or on behalf of, ABLV Bank, located in