US branch of Dutch Rabobank pleas guilty over drug-tied transactions

, Comments 0 comments

The US unit of Dutch bank Rabobank pleaded guilty on Wednesday to obstructing an investigation into the hundreds of millions in drug-tainted cash from Mexico that flowed through its accounts, the Justice Department said.

Rabobank NA of California will forfeit nearly $370 million to US authorities for "allowing illicit funds to be processed through the bank" without adequate anti-money laundering controls, the statement said.

Included in that amount, is a $50 million fine the bank will pay to the Treasury Department.

The announcement comes less than two months after former Rabobank vice president George Martin settled with US prosecutors over his alleged role in the failure to maintain proper safeguards against money laundering.

Prosecutors said that between 2009 and 2012, Rabobank allowed nearly $370 million in untraceable cash sourced from Mexico and elsewhere to pass through its accounts.

"When Rabobank learned that substantial numbers of its customers' transactions were indicative of international narcotics trafficking, organized crime, and money laundering activities, it chose to look the other way and to cover up deficiencies," the Justice Department's John Cronan said in a statement.

"Worse still, Rabobank took steps to obstruct an examination by its regulator into those same deficiencies."

Rabobank's Calexico branch, which sits about two blocks from the US-Mexico border, became the highest performing branch in the southern California county because of the cash deposits from Mexico, according to the Justice Department.

The bank maintained a "verified list" of customers for whose suspicious transactions were not to be reviewed even if they generated alerts from internal control systems. The list expanded from 10 clients in 2009 to more than 1,000 over the following three years.

Bank policy at the time prevented internal investigations into suspicious transactions, as required by law, even though the bank received "regular" alerts about transactions by high-risk customers and accounts, according to prosecutors.

And bank executives in 2012 set obstructed a Treasury Department investigation by lying to examiners and dismissing employees who raised questions internally.

Rabobank also was sanctioned in 2006 and 2008 for regulatory failures that were "nearly identical," the Justice Department said.

© 2018 AFP

0 Comments To This Article