Saturday, 10 January 2009

Lloyds cough up $350 million

I couldn't help laughing when I read this story. From the FT......

Lloyds TSB will pay $350m to settle US investigations after admitting it enabled Iranian and Sudanese clients to access the US banking system in violation of US sanctions, prosecutors said on Friday.

Lloyds said it falsified business records by altering wire transfer information to hide the identity of its clients, said Robert Morgenthau, Manhattan district attorney, who announced the deferred prosecution agreement on Friday.

The process made it appear that transactions originated at Lloyds in the UK rather than the sanctioned banks, according to Mr Morgenthau, who conducted the investigation with the US justice department.

Think about it; there was someone on the payroll in Lloyds who sat down and thought through this seedy little activity.

This is what the Lloyds press release said:

“We are committed to running our business with the highest levels of integrity and regulatory compliance across all of our operations and have undertaken a range of significant steps to further enhance our compliance programmes,”

Indeed, Lloyds has always stood for the the highest levels of integrity.


Anonymous said...

Does this constitute money laundering?

Nick von Mises said...

Just a normal case of OFAC / AML breaches. There's not a lot a bank can do if their own employee is doing it. Except have a reasonable detection system and report them (like the framework in the JMLSG good practice notes).

The only really interesting thing to me is did Lloyds detect and report it themselves

Anonymous said...

If a 350 million quid fine is "normal" AML, what would a serious case of money laundering cost?