Thursday, October 8, 2015


Banco Continental SA, a major Honduran commercial bank, headquartered in San Pedro Sula, has been sanctioned under the Foreign Narcotics Kingpin Designation Act, in connection with a major money laundering case brought in Federal Court, in the Southern District of New York. Members of the Rosenthal family, a prominent force in the Honduran business community, have been charged with money laundering for drug traffickers, and their corporate entities were also designated by OFAC. The bank was listed as an SDNTK.

The Treasury announcement accompanying the sanctions and indictments, explains why the bank was named:

"Today's announcement marks the first time that OFAC has designated a bank, pursuant to the Kingpin Act. Banco Continental SA has served as an integral part of the Rosenthal money laundering operations, and facilitated the laundering of narcotics proceeds for multiple Central American drug trafficking organizations.*"

Many compliance officers have felt, for many years, that merely imposing fines upon foreign financial institutions, for drug money laundering activities, is an insufficient deterrent to others. The Kingpin Act designation, which will effectively bar Banco Continental from the US banking system, is a powerful remedy that, in my opinion, should be employed whenever there is conclusive evidence that a foreign financial institution is a major player in a drug money laundering operation.

Please note that there are a number of other financial institutions in Latin America, and the United States, with similar names, and compliance officers are urged to immediately acquaint their staff with the details of the other banks, lest confusion result in a non-sanctioned bank's transactions be frozen, or  a Banco Continental wire transfer be approved.
*Treasury Sanctions Rosenthal Money Laundering Organization

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