Wachovia Settles Money Laundering Case
LINDA WERTHEIMER, host:
Wachovia Bank is paying $160 million to settle a case involving money laundering and Columbian drug dealers.
From WLRN in Miami, Rick Stone reports.
RICK STONE: Wachovia's accused of failing to set up the Anti-Money Laundering safeguards required by the Bank Secrecy Act over a five-year period, prosecutors say. That allowed more than $420 billion to change hands unmonitored in transactions between Wachovia and Mexican currency exchange houses.
Miami U.S. attorney Jeffrey Sloman says some of the money helped the South American drug trade.
Mr. JEFFREY SLOMAN (Attorney): Wachovia's blatant disregard for our banking laws gave international cocaine cartels a virtual carte blanche to finance their operations by laundering at least $110 million in drug proceeds.
STONE: If Wachovia continues to comply with the Bank Secrecy Act, the federal prosecution will be dismissed a year from now. That could mean federal prosecutors consider it a crime of neglect rather than criminal intent.
Edward Rodriguez is a money laundering expert at Watkins Meegan.
Mr. EDWARD RODRIGUEZ (Anti-Money Laundering and Advisory Services, Watkins Meegan): They dont really prosecute the bank because they're such an intricate part to the community, unless the bank and everyone in the bank was dirty.
STONE: But prosecutors say it was a banking law violation on an historic scale and the action is intended to signal no tolerance for money laundering through U.S. banks.
Wachovia, in an email, refused to comment but acknowledged that its compliance programs were inadequate.
For NPR News, I'm Rick Stone in Miami.
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