North Dade Community Development Federal Credit Union (Miami Gardens, FL) was fined $300,000 by the Financial Crimes Enforcement Network for violation of the Bank Secrecy Act (BSA).
According to the 16 page enforcement order, "North Dade’s BSA failures derived significantly from its banking services to certain money services businesses (“MSBs”). These MSBs were located outside of its geographic field of membership and were engaged in high-risk activities, such as wiring millions of dollars per month to high-risk foreign jurisdictions. For instance, in 2013 alone, the total transaction volume through North Dade by MSBs included $54.8 million in cash orders, $1.01 billion in outgoing wires, $5.3 million in returned checks, and $984.4 million in remote deposit capture. North Dade’s MSB activity accounted for 90% of North Dade’s total annual revenue in 2013."
Read the press release.
A 3.5 million asset institution with nearly $2BILLION in money "transfer"!!
ReplyDeleteGreat.
Feel safe now?!?
How many stories out there like this that we DONT know about?
Fined?
ReplyDeleteWhy not closed???
Fined?
ReplyDeleteWhy not liquidated?
How many of these stories are out there, waiting to be discovered?
FinCEN does not have the authority to close a credit union. Only NCUA can close a federal credit union.
ReplyDeleteThen how is it possible that NCUA is not aware or taking some type of action?
ReplyDeleteNCUA imposed a cease and desist order on North Dade in 2013 for its BSA program violations.
ReplyDeletehttp://www.ncua.gov/Legal/Administrative%20Orders/AO2013-0032-R3.pdf
Did the cu c and d at that point or did it keep up the money "transfer"?
DeleteI don't know the answer to that question.
ReplyDeleteThe Board and management in this credit union as in other credit unions assigns a BSA / Compliance Officer who is responsible to ensure the credit union complies with all BSA and consumer compliance regulation. Obviously the chosen person either had the knowledge, skills and experience to do the job or did not, they either chose to follow the regulation or did not. Any credit union no matter what size needs to understand all the rules of the game. If they don't then they need to seek assistance to understand the rules. There are thousands of real small credit unions that have a good BSA program, so to try to make-up excuses for one helps no one. Honestly I rather see any financial institution (credit union or bank) that is poorly manage to go away because all they do is create havoc for the industry. The Board and management of any financial institution (credit union or bank) are responsible for the overall management of the institution and if they do not know what they are doing then they have no business being in the industry.
ReplyDeleteYou bring up valid points and balanced.
DeleteIn this, and the fear would be that there are others, case the institution seemed complicit.
There are thousands of small bank and credit unions. The regulators struggle to cover them and they're not compliant because they don't make enough profit to pay for the right systems or people to be compliant.