New Jersey Bank Fined for Money Laundering Violations

Authorities have announced that Saddle River Bank in New Jersey has agreed to pay $8.2 million to settle federal claims that it violated United States anti-money laundering laws.  The settlement comes after a federal investigation revealed that the bank failed to monitor over $1.5 billion of transactions between it and non-bank currency exchange businesses in Mexico and the Dominican Republic.

While prosecutors do not believe any money laundering took place on Saddle River Valley’s accounts, they do accuse the bank of focusing on the revenue it made from the “casas de cambio”, rather than the associated risks.

The office of United States Attorney Paul Fishman also cited Saddle River Valley for not properly detecting and reporting suspicious activity on its casas de cambia accounts and for failing to have experienced employees in charge of their anti-money laundering program.

Saddle River Bank filed over 190 “Suspicious Activity Reports” only after the Office of the Comptroller of the Currency ordered the bank to conduct a “lookback” in a late 2011 enforcement action.

Under the settlement, Saddle River Valley Bank agrees to pay a $4.1 million fine to Financial Crimes Enforcement Network and forfeit another $4.1 million to the OCC and the United States Attorney’s Office of New Jersey.

An external spokeswoman for the majority owner of Saddle River Bank, J.C. Flowers, and an attorney representing the bank both declined to comment.

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