Money laundering: The turn of the screw

Jan 1, 2013

Banks are scrambling to tighten controls as US agencies step up their efforts against money laundering. The knock-on effects of new legislation could have a profound impact on the face of Latin banking

By Ivan Castano

December 11, 2012 is a date that HSBC shareholders are unlikely to forget soon. That day, the bank agreed to pay a record $1.92 billion to settle US government fines and forfeitures for money laundering. It was the largest US penalty ever imposed on a bank.

It followed a US Senate investigation which had revealed in July that the bank had transferred $7 billion from Mexican drug cartels – as well as more funds from nations penalized by US sanctions, most notably Iran – into the US. The result of the fine has been a scramble by Latin American banks to strengthen their money laundering safeguards.

"If LatAm bank controls were not up to date then, you can bet they are now," says Mireya Lozano, a Mexico-City based consultant and member of the Association of Certified Anti-Money Laundering Specialists (ACAMS). "No bank wants to see itself...

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