Saturday, January 16, 2016


Remember MoneyGram International, inc., and its $100m fine for failing to create, maintain and operate, an effective AML program, and for other BSA deficiencies ? Its Chief Compliance Officer, Thomas Haider, drew a $1m fine, for willful conduct,  and an injunction against working in a financial institution again.

I am a firm believer in allowing aggrieved parties unfettered access to our court system, but, when Treasury sought to reduce the fine to a judgment*, Haider, in what must be the height of arrogance, and in the face of competent evidence of his compliance malpractice, or negligence (you decide), his counsel moved to dismiss the Federal lawsuit against him. His lawyer interposed Procedural Due Process and Grand Jury issues, as well as asserting that there was no personal liability for the BSA violations.

The District Judge, in a 13-page ruling, held that the unambiguous language of the law showed that Congress had intended that there be personal liability for violations of the Bank Secrecy Act, or its regulations. The Court declined to rule on the issue of the injunction at this stage in the case, and failed to agree with Haider's counsel's minor arguments, or postponed entering a ruling. The case will now proceed to trial; the pretrial conference has already been set for February 9, 2016. You probably have a pretty good idea of the likely outcome.

Therefore, the next time that senior management attempts to strong-arm you into fatally weakening any major component of your AML/CFT program, remember what happened to Thomas Haider and Harold Crawford. You remember Mr. Crawford's case, I trust.
*US Department of the Treasury vs. Thomas E Haider, Case No.: 15-cv-01518-DSD-HB (D Minn).

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