- Treasury Identifies The Lebanese Canadian Bank Sal as Money Laundering Concern
- March 8, 2011 | Authors: Andres A. Fernandez; Marina Olman; Clemente L. Vázquez-Bello
- Law Firm: Gunster, Yoakley & Stewart, P.A. - Miami Office
On February 10, 2011, the U.S. Department of the Treasury (“Treasury”) announced the identification of The Lebanese Canadian Bank SAL, together with its subsidiaries (the “Bank”), as a financial institution of primary money laundering concern under Section 311 of the USA PATRIOT Act (Section 311) (the “Announcement”).
According to Treasury, the Bank has been facilitating the money laundering activities of an international narcotics trafficking and money laundering network (“Network”) that moves illegal drugs from South America to Europe and the Middle East via West Africa. Treasury claims that the Network launders hundreds of millions of dollars monthly through accounts held at the Bank, as well as through trade based money laundering involving consumer goods throughout the world, including used car dealerships in the United States.
Treasury attributes the Bank’s involvement in money laundering to failures in internal controls, inadequate due diligence on high-risk customers and complicity in the money laundering by Bank managers. Treasury also believes that the Bank failed to adequately control transactions that are highly vulnerable to criminal exploitation, such as cash deposits and cross-boarder wire transfers.
Concurrent with the Announcement, Treasury’s Financial Crimes Enforcement Network (FinCEN) filed a Notice of Proposed Rule Making in which it proposes prohibiting U.S. financial institutions from opening or maintaining correspondent or payable-through accounts for the Bank.