NEW YORK — For years, Citigroup employees feared that millions of dollars the bank was moving to Mexico might be suspicious. Yet in many cases, the bank did not alert regulators or step up its monitoring for money laundering, federal prosecutors said Monday.
Even as the Citigroup unit Banamex USA was growing to dominate remittances from the United States to Mexico, the bank did not properly safeguard its systems from being infiltrated by drug money and other illicit funds, prosecutors said.
On Monday, Citigroup agreed to pay $97.4 million in a settlement after a long federal investigation into Banamex USA. In exchange, the Justice Department will not file criminal charges against the bank in connection with inadequate oversight of Banamex USA, which is based in California.
Didn't that cause an oil slick?
As part of the agreement, Banamex USA “admitted to criminal violations by willfully failing to maintain an effective anti-money-laundering” compliance program, the Justice Department said.
The deal represents the first such agreement between a major bank and the Justice Department under Attorney General Jeff Sessions.
Well, uncork the champagne then!
It also resolves some of Citigroup’s most serious regulatory issues related to its profitable, but risky, business in Mexico.
From 2007 to 2012, Banamex USA generated about 18,000 internal alerts of suspicious transactions among the 30 million Mexico remittances it processed, prosecutors said, yet the bank conducted fewer than 10 investigations and filed only six suspicious activity reports with regulators.
Among the red flags that Banamex USA did not heed was $1.3 billion in remittances that each totaled more than $1,500 — five times the amount that families typically send.
Most families receive remittances from one or two predictable sources. But one account holder in Mexico received 1,400 remittances from 950 senders in 40 states. Despite several automatic alerts about these transactions, Banamex USA did not file a suspicious activity report with regulators.
One of the biggest problems was staffing. The bank had only two people assigned to review the thousands of suspicious transactions manually. Citigroup inherited Banamex USA in 2001, when the bank acquired Banamex, one of Mexico’s largest banks.
Maybe they didn't want to $ee it. We all know drug money is what bolster the bottom lines of banks, and they all launder.
Banamex helped fuel Citigroup’s profit as the bank rode the wave of Mexico’s growing economy and financial modernization. Banamex USA was supposed to build on Citigroup’s access to Mexico’s market by connecting the millions of Mexican immigrants in the United States who needed to send money to their families at home.
But Banamex has also been a source of scandals, which eventually toppled one of its executives, the co-president, Manuel Medina-Mora, who oversaw its Mexico operations and retired in 2015.
Citigroup has been closing Banamex USA. On Monday, Citigroup said it expected the troubled unit would cease operations by June 30.
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Looks like Da Fix was in.
Related: Final Sessions
See: Senate intelligence panel to subpoena two Flynn companies
At lea$t the banks are in good $hape:
"US banks in strong shape as fourth-quarter profit jumps" by Marcy Gordon Associated Press March 01, 2017
WASHINGTON — US banks’ earnings in the final quarter of 2016 rose 7.7 percent from a year earlier, as lending continued to grow and banks set aside less for losses on loans for the first time since late 2015.
The data issued Tuesday by the Federal Deposit Insurance Corp. showed strength in the industry more than eight years after the financial crisis struck. However, banks continued to post bigger losses on loans, especially for credit cards and commercial and industrial loans.
The FDIC reported that US banks earned $43.7 billion in the fourth quarter, up from $40.8 billion a year earlier. Almost 60 percent of banks reported an increase in profit from a year earlier. Only 8.1 percent of banks were unprofitable, down from 9.6 percent in the fourth quarter of 2015.
FDIC chairman Martin Gruenberg said some banks have been getting around low interest rates that crimp their profits by making more risky loans with higher rates and extending the terms of loans. FDIC examiners will continue to keep a close eye on the situation, he said.
Uh-oh.
As a sign of a healthy banking industry, overall lending increased by 0.8 percent. Credit card loans showed the biggest growth, 5 percent, while lending for real estate construction rose 3.3 percent. Banks’ net interest income on loans increased by $8.4 billion, or 7.6 percent. At the same time, the volume of credit card loans that were written off in the fourth quarter rose by $1.4 billion, or 24.8 percent. Commercial and industrial loans written off jumped by $666 million, or 37.9 percent.
After the election of President Trump in November, long-term interest rates climbed, propelled largely by investors’ belief that his plan to cut taxes and spend massively on roads, bridges, airports, and other infrastructure could ignite inflation. When they foresee rising inflation, bond investors demand higher long-term rates and pay lower prices for bonds.
I pray to God it isn't him.
Banks could earn more interest on loans. On Wall Street, the anticipation of higher rates has helped push up prices of bank stocks. Also stoking the rise have been expectations that regulations affecting the banking industry will be eased in the Trump administration.
We call that u$ury.
Trump earlier this month launched his long-promised attack on banking restrictions that came into law after the financial crisis, ordering his Treasury secretary to review the 2010 Dodd-Frank oversight law. Federal Reserve policy makers recently decided to leave the central bank’s key interest rate unchanged. But they discussed the need to raise the rate again ‘‘fairly soon,’’ especially if the economy remains strong. Gruenberg has said that higher interest rates could be ‘‘a double-edged sword’’ for the banking industry. While bringing in more interest on loans, it also could increase the cost for banks to borrow to fund the loans they make.
The number of bank failures continues to slow. So far this year, two banks have failed. Five were shuttered in all of last year. Failures declined from 24 in 2013 to 18 in 2014 and only eight in 2015. They are down sharply from 157 in 2010 — the most in one year since the height of the savings and loan crisis in 1992. In a strong economy, an average of four or five banks closes annually....
If the banks are healthy then everything must be fine.
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Related:
"Target is celebrating the stretch mark as a thing of beauty. The chain has launched a swimwear campaign on social media that features four models in unretouched images as it promotes a focus on inclusivity. Social media star Megan Batoon, pro skateboarder Lizzie Armanto, model and body activist Denise Bidot, and TV host and model Kamie Crawford star in the ad that features one- and two-piece suits. The move follows Target and other retailers’ increasing focus on embracing all body types and bolstering their offerings of plus-size clothing in fashion collections. Minneapolis-based Target says it wanted to take an approach to swimwear that shows women in all their beauty — stretchmarks and all."
Then go out and get here a nice piece of jewelry.
**********
More of a threat:
UK raises terror threat, believes another attack may be imminent
Intelligence on ISIS led to restrictions on electronic devices
They ended up not doing them.
Tory Lead Tumbling
May Day, May Day!!
In Manchester, facing insidious trauma with communal strength
Attacks on soft targets likely to get worse
Like what, banks?
"Chinese firm ZTE pleads guilty to breaking Iran sanctions" by Paul Wiseman and Sadie Gurman Associated Press March 08, 2017
WASHINGTON — Chinese cellphone equipment maker ZTE Corp. will plead guilty and pay the United States nearly $900 million for shipping sensitive US-made technology to Iran in violation of US sanctions, the Justice Department said Tuesday.
At least they didn't spill secret intelligence from Israel to the enemy, 'er, Russians.
The corporation violated export controls that are designed that keep sensitive American technology out of the hands of hostile regimes and lied to federal investigators about their actions, Attorney General Jeff Sessions said.
ZTE pleaded guilty to three felonies and also settled charges with the Commerce and Treasury departments. It has also agreed to pay another $300 million, suspended during a seven-year-period, if it does not meet the terms of the agreement, which includes the appointment of a corporate compliance monitor.
The settlement marks the largest civil fine ever imposed in a Commerce Department export control case. An official who requested anonymity to discuss the terms of the agreement said it was also largest Justice Department criminal fine in an export control or sanctions case.
The Trump administration sought to portray the settlement as a sign it intended to get tough on those who violate sanctions. ‘‘Those who flout our economic sanctions and export controls will not go unpunished,’’ Commerce Secretary Wilbur Ross said in a statement, but much of the investigation was conducted under the Obama administration. The departments of Justice and Homeland Security started looking into reports of illegal conduct by ZTE in 2012.
‘‘It’s a big deal — it sends a really strong message,’’ said Amanda DeBusk, chair of the international department at the law firm Hughes Hubbard & Reed. ‘‘The US isn’t going to be shy about going after companies connected to the Chinese government.’’
They might be now, what with needing the help in Korea and all.
Several of ZTE’s top shareholders are corporations owned by the Chinese government.
According to court documents, ZTE obtained the banned goods, including cellular network equipment, over a six-year period and shipped them to customers in Iran, knowing that the sales violated the sanctions. The company also made 283 shipments of cellphone equipment to North Korea in violation of US embargos in that country, the Commerce Department said.
‘‘ZTE acknowledges the mistakes it made, takes responsibility for them, and remains committed to positive change in the company ... We are committed to a new ZTE, compliant, healthy and trustworthy,’’ ZTE CEO Zhao Xianming said in a statement.
Officials from the departments described an elaborate scheme by the company to ship about $32 million worth of US-made equipment to Iran while lying to federal investigators. ZTE hid the data related to the transactions from a forensic accounting firm.
Founded in 1985, ZTE is based in China’s southern province of Guangdong. It is one of the world’s biggest telecommunications companies with subsidiaries in the United States, Asia, Europe, and South America.
Did they put trapdoors in their phones like the CIA does in ours?
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Related: China warns of arms race after US deploys missile defense in South Korea.... the United States will pay for the Terminal High Altitude Area Defense system, or THAAD, to be built by Lockheed Martin, as well as its operational costs.
So how much is that going to cost as he is shredding the safety net back home?
Speaking of drones....
"With aging jets and a shortage of pilots, the Air Force weighs buying throwback ‘light-attack’ planes" by Dan Lamothe February 28, 2017
The U.S. Air Force, faced with a potentially protracted war against the Islamic State, aging fighter jets and a shrinking force of pilots, is examining the adoption of a new fleet of “light-attack” planes that are both a throwback to earlier U.S. operations and a current staple of militaries in South America and the Middle East.
The aircraft would be able to carry out airstrikes against the Islamic State and other militants for less money than the F-16 Fighting Falcon or the F/A-18 Super Hornet. Options available could include Embraer’s A-29 Super Tucano propeller plane, which the United States has delivered to Afghanistan and other allies, and Beechcraft’s AT-6, a version of which the U.S. military already uses in pilot training.
Air Force generals have discussed the proposal several times in recent weeks, saying that the planes could supplement existing aircraft, including drones, in regions where there is no enemy capable of shooting down U.S. planes.
And where would that be?
Gen. David L. Goldfein, the service’s top officer, said the proposal is part of an ongoing dialogue that dates back years and could soon include an experiment in which private companies demonstrate what the planes can do.
“I’m not interested in something that requires a lot of research and development here,” Goldfein said during a recent appearance at the Center for Strategic and International Studies. “I’m looking for something that I can get at right now, commercial, off the shelf, low-cost, that can operate in an uncontested environment, that can deliver the capabilities that we need, that can also be something that perhaps our allies and partners that are in this fight with us” use.
The experiment will follow related efforts in Iraq and the United States. In the most recent, U.S. Central Command deployed two Vietnam-era, twin-engine OV-10G Broncos on loan from NASA to Iraq in 2015, flying them in missions against the Islamic State to assess how light-attack planes might help in the air war.
Air Force officials estimate that the cost of flying a propeller plane like the A-29 or AT-6 would be a few thousand dollars per hour. In comparison, it costs about $18,000 per hour to fly the A-10 attack jet. Other hourly costs are: $19,000 for the F-16; $24,000 for the F-15E; $42,000 for the F-35A; $44,000 for the AC-130J; $62,000 for the F-22A; $63,000 for the B-52; $77,000 for the B-1B; and $120,000 for the B-2, according to service statistics....
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Related: ISIS’s drones are threat, but Pentagon braces to face more-advanced ‘suicide’ aircraft
In a Terminator future we are all on the same side, no?
What do we do when the AI decides all humans are a threat and need to be exterminated?
"Report reveals details of $21 billion money laundering plan" by Matti Huuhtanen Associated Press March 22, 2017
HELSINKI — A group of anti-corruption reporters who in 2014 exposed a criminal scheme to move large sums of money out of Russia say they’ve uncovered details about how the system worked, including the transfer of $21 billion through major banks.
Members of the group say in a report published late Monday that they now know where the funds ended up and that banks allegedly refused to shut it down, despite warnings.
Better get $e$$ions on the ca$e.
The Organized Crime and Corruption Reporting Project said that reporters from the group and the Novaya Gazeta newspaper in Moscow obtained bank records showing that funds were transferred worldwide via 112 bank accounts in Eastern Europe. They shared the details of the scheme, dubbed Laundromat, with investigative reporters in 32 countries.
‘‘Law enforcement agencies in Moldova, Latvia, Britain, and Russia continue to investigate Laundromat, but attempts to bring those responsible to justice and to recover the money have been hampered in part by the reluctance of Russian officials to cooperate,’’ the group said on its website.
Organizers of the scheme created a core of 21 companies based in Britain, Cyprus and New Zealand, run by hidden owners and used by several Russian companies to move their money abroad. All of the core companies appeared to be owned by proxies standing in for hidden owners, with fake directors and shareholders, though the reporters provided no evidence to back the claims.
See that waste basket over there?
Please go deposit this pos propaganda there.
Between 2011 and 2014, the 21 shell companies sent 26,746 payments from various accounts to 96 countries, including to some of the world’s biggest banks, such as HSBC, Deutsche Bank, Bank of China, Bank of America, and Emirates NBD.
Oh, I $ee. The too-big-to-jail, drug-money-laundering banks.
Laundered money ended up at several big name companies, including South Korea’s Samsung, Swedish telecom company Ericsson, toolmaker Black & Decker and Total Golf Construction Inc., which says it has renovated a Donald Trump golf course in the Grenadines.
Impeach, impeach, impeach. $igh.
Companies contacted over the report denied wrongdoing, saying such business methods were common with Russian clients and added that they had stopped dealing with them. They declined to identify the clients.
Must be part of the Jewi$h mafia then.
Using company records, the investigative reporters said they tracked some clients, many rich and powerful Russians who made fortunes from dealing with the Russian state, including a businessman in the inner circle of Russian President Vladimir Putin and IT distributors in Russia, including for Apple, Samsung and Asus.
Some $1.2 billion was allegedly funneled through the Estonian branch of Denmark’s largest bank, Danske Bank, which acknowledged a ‘‘case of possible international money laundering’’ with illegitimate transactions at its Estonian branch in 2011-2014.
Danske Bank spokesman Flemming Pristed said security procedures had been ‘‘insufficient’’ but now had been improved. Other banks, including Deutsche Bank, have since been fined for lax controls on money laundering schemes.
Reacting to the news, Danish Prime Minister Lars Loekke Rasmussen on Tuesday called the money laundering a disgrace. ‘‘It makes me sad and angry,’’ he told Denmark’s TV2.
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The $ource of all the loot again:
"Drug raids south of Boston nets 16 arrests" by Laura Crimaldi Globe Staff March 21, 2017
Authorities arrested 16 people and seized large quantities of suspected heroin and other drugs, cash, and 10 firearms Tuesday during raids around the region that grew out of a Randolph police investigation into a drug-distribution operation, officials said.
The suspects were taken into custody during predawn raids at nine spots in Randolph plus locations in Boston, Braintree, Quincy, Brockton, West Bridgewater, East Bridgewater, Milton, and Carver, prosecutors said.
Ten of the defendants are accused of conspiring to violate drug laws with Carl H. French, 37, of Randolph, who was also arrested Tuesday and accused of money laundering and distributing oxycodone, court records show. Drug trafficking charges were filed against three people. Randolph residents Shante M. Green, who turns 31 Wednesday, and Octavio T. Nares, 38, were accused of trafficking heroin and cocaine and an ammunition offense. Vincent Bonanno, 27, of Randolph, faces charges of heroin trafficking and firearms offenses, according to court records.
Fourteen of the defendants were arraigned Tuesday in Quincy District Court, where they pleaded not guilty, the DA’s office said. Arraignments for two others are scheduled for Wednesday. Norfolk District Attorney Michael W. Morrissey said the investigation was part of efforts to combat the opioid crisis plaguing the state. He said Norfolk County recorded more than 170 fatal overdoses last year because of the supply of heroin and fentanyl, a powerful synthetic opioid.
“Law enforcement is pushing hard for increased addiction prevention, treatment for addiction, and diminishing the demand for these drugs, but it remains vital that we work to close off the supply of poisons that are killing our citizens by the hundreds,” Morrissey said in statement.
Randolph had nine fatal opioid overdoses in 2015, according to the DA’s office. Last year’s figures weren’t available Tuesday, a spokesman said. “Randolph will be safer tonight because of this operation,” Police Chief William Pace said in a statement. “This investigation was complex, and I commend all agencies that were involved for their professionalism and collaboration in getting these deadly drugs off our streets.”
Maybe I can finally get some good sleep tonight.
The officers who participated in the operation came from 19 cities and towns, sheriff’s departments in Norfolk and Plymouth counties, the US Drug Enforcement Administration and the FBI, officials said. The South Shore Drug Task Force helped Randolph police with the investigation, officials said.
“Those suffering from the disease of opioid addiction need access to treatment and recovery,” said Michael J. Ferguson, the special agent in charge for the DEA in New England. “This investigation demonstrates the strength of collaborative law enforcement efforts to intensely go after anyone who trafficks these poisons.”
Unless, of course, it is the government itself.
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What a racquet, huh?
Time for the Celtics game.
