banks need point person for money-laundering lapses: regulator
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[March 18, 2014]
By Brett Wolf and Emily Stephenson
HOLLYWOOD, Fla. / WASHINGTON (Reuters) — Big banks should designate senior managers to oversee efforts to
police transactions for criminal activity and take responsibility
when lapses occur, a top U.S. financial regulator said on Monday.
Comptroller of the Currency Thomas Curry said "murky" lines of
accountability at the biggest banks in the United States have
prevented regulators from determining who was to blame for major
anti-money laundering compliance failures.
"Management at large banks needs to eliminate these accreted
compliance weaknesses so that institutional structural flaws do not
become an excuse for a lack of accountability," Curry said on Monday
to a group of anti-money laundering specialists.
Compliance with these rules has become a hot issue after
London-based HSBC Holdings agreed to pay $1.9 billion in 2012 to
settle claims it flouted rules to prevent money laundering and
transactions with countries under U.S. sanctions.
JPMorgan Chase last year settled charges it ignored anti-money
laundering laws in its dealings with convicted Ponzi schemer Bernard
Madoff, and Citigroup is now facing a probe relating to its Mexico
As a result, compliance experts are in high demand. Recruiters say
the need at big banks outstrips the supply of qualified people.
Overall, Curry said regulators have seen improvements in compliance
efforts at the biggest banks. Many of them have added resources and
people to transaction-monitoring operations.
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After his speech, Curry said that the person with final
responsibility should be higher up in the organization, "someone
with stature who can effect meaningful change."
He would not speculate on how that person could be held accountable
for lapses and said the change should be made through the
supervision process, not by regulatory rule making.
(Reporting by Emily Stephenson; editing by Bernadette Baum)
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