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Welcome to the April 2024 summary of news you can use as your bank or other financial institution attempts to stay up to date on the world of BSA/AML compliance. Our monthly series of curated news about financial crime developments, resources and stories.
In this edition, three main stories emerge:
- Vietnam metes out death sentence to billionaire for financial fraud
- FinCen seeks comments on CIP requirement due to technology advances
- UK solicitor fined for not properly training staff around AML
Vietnam metes out death sentence to billionaire for financial fraud
Vietnamese authorities sentenced to death billionaire Truong My Lan for embezzling $12.5 billion, the equivalent of 3% of Vietnam’s GDP. She was convicted for not just the embezzlement, but also for taking out $44bn in loans from the Saigon Commercial Bank (SCB) and owning a majority of shares in SCB. Vietnamese law prohibits any individual from holding more than five percent of the shares in any bank.
Vietnamese authorities wanted to send a message by meting out the death sentence to Truong My Lan and by convicting 85 other people alongside her. Four received lifetime jail sentences, while the others received prison terms ranging from three years suspended to 20 years.
Truong My Lan was able to take out the illegal loans and embezzle the $12.5 billion by establishing hundreds of shell companies and having people working at, and dealing with those companies, act as her proxies. “The government appears determined to prevent another banking scandal like SCB from occurring, and Lan’s death sentence serves as a strong message to bank owners that they must cease illegal business practices or face severe consequences,” said Le Hong Hiep, a senior fellow at the ISEAS–Yusof Ishak Institute’s Vietnam Studies Program in Singapore.
Read here for further details:
Truong My Lan: Is Vietnam’s corruption fight going too far? – DW – 04/16/2024
Truong My Lan: Vietnamese billionaire sentenced to death for $44bn fraud (bbc.com)
FinCen seeks comments on CIP requirement due to technology advances
Section 6216 of the Anti-Money Laundering Act of 2020 requires FinCEN to identify regulations and guidance that may be outdated, redundant, or otherwise do not promote a risk-based anti-money laundering/countering the financing of terrorism (AML/CFT) regime. To that end, FinCen issued on March 29, 2024 an RFI in the Federal Register to help determine if the CIP requirement of collecting full TIN information on customers continues to be a necessary part of the CIP rule.
In issuing the RFI, FinCen is recognizing that significant changes in technology and financial services have taken place since promulgation of the CIP Rule and that banks and other financial institutions have numerous ways to gather full TIN data from customers without explicitly demanding it when starting a relationship. “…we welcome comments from interested parties as we explore ways to modernize the U.S. anti-money laundering/countering the financing of terrorism regime,” said FinCEN Director Andrea M. Gacki. “FinCEN recognizes that since the adoption of the CIP Rule there has been significant innovation in customer identifying information collection and verification tools available to banks and other financial institutions.”
Interested parties need to comment on the RFI within 60 days of March 29, 2024 (by May 28, 2024). To get started, they can visit the RFI page at the Federal Register to access the complete RFI:
Read here for further details:
UK solicitor fined for not properly training staff around AML
The solicitor firm of Austen-Jones has been fined £15,000 by the Solicitors Regulation Authority (SRA) for failing to train staff in AML. Austen-Jones Solicitors was fined because they failed to make staff aware of AML requirements and neglected to provide them with relevant training. The firm also failed to have in place or maintain the required AML documents for doing conveyancing work (transferring ownership of property).
The SRA had contacted Austen-Jones in 2020 about making a declaration about having a risk assessment in place, and the firm responded immediately to apologize and state that it had not undertaken the risk assessment. But when the SRA carried out an inspection in November 2022, the supervision team found several failures to comply with money laundering regulations. These included failing to have a firm-wide assessment in place and for almost six years failing to have the required policies, controls and procedures.
Read here for further details:
To access in-depth insights on how your organization can more effectively and efficiently overcome BSA/AML compliance challenges, visit the Resources page at WorkFusion to gain in-depth insights and a wide range of best practices information.