Tuesday, March 24, 2015


The news of the week included a reference to a possible move, by the Department of Justice, to go back, and revisit, some of the Deferred Prosecution Agreements, and Non-Prosecution Agreements, granted to some of the world's largest international banks, for massive AML/CFT and sanctions violations. The concept is to increase the monetary penalties, should the banks involved fail to reform, or worse, engage in repeated bad acts.

While I support this proposed program, since a number of the guilty banks have engaged in repeated violations,  notwithstanding multiple regulatory actions, such increased fines will be insufficient to change corporate culture based upon profit, which accepts fines as the costs of doing business, and returns to the illicit conduct, again & again. They do not care about a fine that takes 5% of their banks' annual profits.

Gentlemen, the only satisfactory deterrent is to put a number of senior bank executives in Federal Prison for money laundering, so that all the others recognize that this is a threat to them personally. Nothing less will work. Only when they truly fear DOJ enforcement action against them will they think long and hard before placing lucrative profits, earned illegally, before obeying the law.

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