us

216.73.216.2

US Authorities Impose Anti-Money Laundering Crackdown on Offshore Lenders

n-img-us-authority

The US Financial Crimes Enforcement Network (FinCEN) threatened offshore lenders with Anti-Money Laundering (AML) crackdowns to combat the issue alongside terrorist financing. 

After a Puerto Rican lender was fined $15m for allegedly facilitating drug trafficking, money laundering, and crypto scams, the US regulatory authorities pledged to prevent the financial ecosystem from monetary crimes by clamping down on offshore institutes and organisations. The FinCEN also eliminated the operations of a San Juan-based bank, Bancrédito, accused of failing to comply with the AML requirements and the due diligence in the transactional reporting between October 2015 to December 2022. 

The investigation authority, FinCEN, claimed that the bank approved a $100m transaction of the AllBank Corporation, a Panama-based lender that shut down in 2019, through the correspondent banks. These included payments made on behalf of a person whose yacht and aircraft were seized by the Drug Enforcement Agency, wire transfers made by a Venezuelan national who was found guilty of bribing government officials in Argentina, and multiple transactions from a business associated with the OneCoin cryptocurrency scam.

The FinCEN director stated the authority “is sending the message that the era of easy money laundering through Puerto Rican IBEs is over. Correspondent accounts held in the US by foreign financial institutions serve as an important gateway to the US economy but have long been recognised to present unique risks that the US financial institutions need to manage appropriately. Bancrédito’s failure allowed nearly an unfettered flow of funds by these international correspondent accounts through the US financial system, jeopardising the integrity of the United States financial system. ”

Before 2021, International Banking Entities (IBEs) were not required to comply with the due diligence verification regulations, although they must report suspicious transactions under the Bank Secrecy Act (BSA). According to US Law, IBEs can only provide loans and deposits to foreign customer’s offshore businesses and are not allowed to deal with the local residents of Puerto Rica. However, based on current data available, as of April 2022, there were 27 IBEs, including local offices of multinational lenders Citi and UBS, operating in Puerto Rico and holding assets worth more than $49bn.

Suggested Reads:

US TREASURY OFFICIAL URGES IRAQ’S CENTRAL BANK TO ACT AGAINST MONEY LAUNDERING

US GOVERNMENT TO ESTABLISH NEW CORPORATE TRANSPARENCY ACT REGULATIONS TO VERIFY UBOS

US COURT DECLARES BITCOIN AND ETH AS COMMODITIES, DISMISSING UNISWAP LAWSUIT

Related Posts

News

Malaysia to push mandatory ID checks on social media to curb online scams

Malaysia to push mandatory ID checks on social media to curb online scams

Explore More

News

Michigan Lawmakers propose that Age Verification be mandatory to access pornography

Michigan Lawmakers propose that Age Verification be mandatory to access pornography

Explore More

News

Brazil enacts new law to regulate children’s use of social media and digital platforms

Brazil enacts new law to regulate children’s use of social media and digital platforms

Explore More

News

ChatGPT to introduce age checks after the UK’s teen death sparks lawsuits

ChatGPT to introduce age checks after the UK’s teen death sparks lawsuits

Explore More

News

Australia’s Under-16 Social Media Ban allows a margin of error in age verification

Australia’s Under-16 Social Media Ban allows a margin of error in age verification

Explore More

News

New York outlines age checks and parental consent for minors under the SAFE for Kids Act

New York outlines age checks and parental consent for minors under the SAFE for Kids Act

Explore More

News

Wolfsberg Group Urges Financial Institutions to Adopt AI for Monitoring Suspicious Activities

Wolfsberg Group Urges Financial Institutions to Adopt AI for Monitoring Suspicious Activities

Explore More

News

Malaysia to push mandatory ID checks on social media to curb online scams

Malaysia to push mandatory ID checks on social media to curb online scams

Explore More

News

Michigan Lawmakers propose that Age Verification be mandatory to access pornography

Michigan Lawmakers propose that Age Verification be mandatory to access pornography

Explore More

News

Brazil enacts new law to regulate children’s use of social media and digital platforms

Brazil enacts new law to regulate children’s use of social media and digital platforms

Explore More

News

ChatGPT to introduce age checks after the UK’s teen death sparks lawsuits

ChatGPT to introduce age checks after the UK’s teen death sparks lawsuits

Explore More

News

Australia’s Under-16 Social Media Ban allows a margin of error in age verification

Australia’s Under-16 Social Media Ban allows a margin of error in age verification

Explore More

News

New York outlines age checks and parental consent for minors under the SAFE for Kids Act

New York outlines age checks and parental consent for minors under the SAFE for Kids Act

Explore More

News

Wolfsberg Group Urges Financial Institutions to Adopt AI for Monitoring Suspicious Activities

Wolfsberg Group Urges Financial Institutions to Adopt AI for Monitoring Suspicious Activities

Explore More

Take the next steps to better security.

Contact us

Get in touch with our experts. We'll help you find the perfect solution for your compliance and security needs.

Contact us

Request demo

Get free access to our platform and try our products today.

Get started