Wachovia Bank will pay USD 160 million for Money Laundering

According to the US Department of Justice, Wachovia Bank, which was purchased by Wells Fargo & Co., agreed to settle a money laundering case with USD 160 million.

Wachovia made a statement claiming that it had spent USD 42 million in upgrades to its security system in order to “strengthen its ability to guard against unlawful use of its system by wrongdoers.”

The US Department of Justice said that Wachovia had “admitted failure to identify, detect, and report suspicious transactions in third-party payment processor accounts.” About USD 420 billion in transfers went through Wachovia Bank without adequate money laundering detection systems in place. According to prosecutors, billions of USD transferred from Mexican money exchange houses were used for buying planes for drug traffickers.

Federal attorney Jeffrey Sloman said, “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. Corporate citizens, no matter how big or powerful, must be held accountable for their actions.”

The Bank agreed to pay USD 110 million to the US Justice Department and USD 50 million to the US Treasury.

Leave a Reply

You must be logged in to post a comment.