Originally published June 25 2005
Bankers given better guidelines on reporting suspicious banking activity
by Mike Adams, the Health Ranger, NaturalNews Editor
Business Week reports on a meeting between the federal government and bankers to clear up the rules for reporting banking activity that may actually be money laundering by terrorists.
he head of the federal agency working to keep terrorists from laundering money in U.S. banks told 1,300 bankers Tuesday that they are America's "eyes and ears" when it comes to spotting suspicious banking activity.
But William Fox, director of the Treasury Department's Financial Crimes Enforcement Network, dubbed FinCen, also urged the bankers to "calm down a little bit" and use their judgment when deciding whether to report a customer's actions.
Since the Sept. 11, 2001, terrorist attacks, federal regulators have stepped up enforcement of the Bank Secrecy Act, an anti-money laundering law, passed in 1970, that makes banks responsible for reporting unusual cash activity.
Fox said bankers are filing too many suspicious activity reports (SAR) because they're worried that missing a possible terrorist will ruin their company's image or garner a fine.
Fox said "defensive filing" is bogging down his department; he gave an example of a company that filed a SAR when a worker stole bacon from the cafeteria.
"We're all going to have to calm down a little bit," Fox told the American Bankers Association's regulatory compliance conference.
The jump in "defensive filing" began in earnest after two banks recently received large fines for not filing SARs, said ABA spokesman John Hall.
Riggs Bank, now owned by Pittsburgh-based PNC Financial Services Group Inc., pleaded guilty in January to a felony charge of failing to report suspicious transactions involving foreigners -- including former Chilean dictator Augusto Pinochet and members of his family.
In October, Birmingham, Ala.-based AmSouth Bank was ordered to pay $40 million to the federal government for not filing SARs.
Fox acknowledged that the government has done a "poor job of providing information" to banks to help them analyze the risks some customers could pose.
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