New York Announces Agreement to Resolve Alleged International Sanctions Violations

Anti-Money Laundering Bank Secrecy Act Enforcement Sanctions

On June 20, New York announced a consent order with the New York branch of a foreign bank to resolve charges that the bank — over a five year period that ended more than five years ago — violated Bank Secrecy Act, Anti-Money Laundering and international sanctions rules by stripping from wire transfer messages information that could have been used to identify government and privately owned entities in Iran, Sudan, and Myanmar, and entities on the Specially Designated Nationals list issued by the OFAC and moving billions of dollars through New York on their behalf. The order requires the bank to pay a $250 million penalty, conduct a compliance review, and revise written compliance and management oversight plans. The compliance review must be conducted by an independent consultant that will be subject to the new DFS code of conduct for bank consultants described in a prior Byte. This is at least the second time in the last year that New York has taken a major action against a domestic branch of a foreign bank related to money laundering and international sanctions violations. In a previous instance, federal authorities followed with substantial civil and criminal penalties related to the same conduct.