Regulatory Compliance for Financial Institutions – Industry News


BNP Paribas hires ex-U.S.Treasury official for compliance job

BNP Paribas has hired a former top official at the U.S. Treasury Department’s sanctions office, people familiar with the matter said, part of the French bank’s effort to build up its compliance department after its record settlement over sanctions violations. Sean Thornton, a former chief counsel at Treasury’s Office of Foreign Assets Control, will become legal counsel for Paribas’ U.S. sanctions compliance group, one of the people said. He will head the Group Financial Security U.S. legal team. BNP Paribas in June agreed to pay U.S. authorities $8.9 billion and to plead guilty to criminal charges for conspiring to violate sanctions on Sudan and other countries, in part by stripping information from wire transfers so they could pass through the U.S. system without raising red flags. [Read more…]  

Regulatory pressures to force banks into legacy IT systems upgrades, senior bank officials predict

Temenos surveyed 198 senior bank industry managers from across the globe, including chief executives, chief information officers, chief technology officers and senior IT managers. The survey states that 53% believe their business will be forced into replacing their core IT systems by regulatory demands. “A large number of senior bankers believe that, ultimately, it will be regulators and not management who will force the issue of IT renewal,” Temenos said in its survey report (registration required). “More than half of respondents (53%) believe that regulators will ultimately force banks to update their mission-critical systems.” [Read more…]  

UBS clients lead Canadian surge in admitting hidden offshore income

Clients of UBS AG, Switzerland’s largest bank, have led a fivefold surge in the number of Canadian residents reporting hidden offshore income over the past eight years. Almost 6,000 taxpayers came forward in the past 12 months as part of the Canada Revenue Agency’s voluntary disclosure program to report hidden assets, up from 1,200 in 2006. UBS has more of these clients than any other bank, with about 800 customers reporting hidden assets worth about $218 million, said Philippe Brideau, a spokesman for the country’s national tax collector. [Read more…]  

Supreme Court rules against banks in highly watched case

The Supreme Court of Canada has ruled against nine of the country’s largest financial institutions in a decade-old class action lawsuit that raises questions about provincial power in federally regulated industries. In a widely watched ruling, the Supreme Court ruled that the plaintiffs have the right to sue multiple banks and credit card companies for failing to disclose certain foreign exchange charges, thereby violating Quebec’s Consumer Protection Act. [Read more…]  

Bank of Montreal is sued over Tom Petters’ Ponzi scheme

Bank of Montreal was sued on Thursday by a trustee liquidating two Florida funds that claimed to have lost money in a Ponzi scheme operated by Minnesota businessman Thomas Petters. The lawsuit seeks to recoup $23.6 billion, more than six times the estimated $3.65 billion size of Petters’ fraud, based on sums transferred by Petters over five years to an account at Marshall & Ilsley Bank, which Bank of Montreal now owns. “There is no merit to these claims and we will defend ourselves vigorously,” Carey Allen, a spokeswoman for Bank of Montreal’s BMO Harris Bank unit, said in an emailed statement. [Read more…]  

Compliance Officer Probes Stir Alarm Among Their Peers

U.S. regulators have vowed to hold more individuals responsible for controls failures at financial institutions and the spotlight on two compliance officers has already stirred concerns in the profession about being penalized for decisions made on the job. In February, the Financial Industry Regulatory Authority fined Harold Crawford, Brown Brothers Harriman’s global anti-money laundering compliance officer until the end of last year. Also, the Treasury Department’s Financial Crimes Enforcement Network has recently investigated Thomas Haider, money-transfer company MoneyGram International Inc.’s former chief compliance officer, over suspected anti-money laundering oversight lapses, people familiar with the matter said. The status of that investigation isn’t clear. [Read more…]  

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