Massive fine for Dutch bank's drug money
February 8, 2018
The US subsidiary of the Dutch bank Rabobank will have to pay $369 million (€301 million) to government authorities after it pled guilty to hiding information from investigators.
The bank was part of a money laundering scheme that hid drug money from Mexico.
How the crime unfolded
- Between 2009 and 2012, Rabobank handled hundreds of millions of dollars from Mexican drug dealers.
- The Justice Department was alerted when the bank's office in Calexico, California, two blocks from the US-Mexico border suddenly became the firm's best-performing branch.
- The bank maintained a list of "verified" customers whose suspicious transactions were not put under review when they were flagged by internal control systems.
- The list expanded from 10 clients in 2009 to more than 1,000 by 2012.
- In 2012, bank executives obstructed a probe into their conduct by lying to Treasury Department investigators and firing employees who questioned the bank's dubious practices.
Read more: Police arrest Brazil's cocaine kingpin Luiz Carlos da Rocha
Turning a blind eye
"When Rabobank learned that substantial numbers of its customers' transactions were indicative of international narcotics trafficking, organized crime, and money laundering activities, it chose to look the other way and to cover up deficiencies," said Justice Department official John Cronan.
Rabobank's lawyer James Cavoli declined to speak to the press, and the company has yet to release a statement on the plea deal.
What's significant: The settlement is among the largest in history for laundering Mexican drug money, although it's still significantly less than a 2012 fine paid by HSBC, which was $1.9 billion, for money laundering. In 2010, Wachovia Bank paid $160 million for similar crimes.
What happens next: Rabobank must pay $369 million for the money it laundered, $50 million of which is a fine from the Treasury Department.
Read more: Mexico posts record-breaking homicide rate in 2017
es/aw (AP, AFP)