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FinCEN Assesses $1 Million Penalty and Seeks to Bar Former MoneyGram Executive from Financial Industry

FinCEN Assesses $1 Million Penalty and Seeks to Bar Former MoneyGram Executive from Financial Industry

Individual Accountability Emphasized in Civil Actions Click here to see Press Release Actual Court Documents can be seen at: http://www.fincen.gov/news_room/ea/files/Haider_Assessment.pdf http://www.fincen.gov/news_room/ea/files/USAO_SDNY_Complaint.pdf   WASHINGTON, DC – The Financial Crimes Enforcement Network (FinCEN) today issued a $1 million civil money penalty(CMP) against Mr. Thomas E. Haider for failing to ensure that hiscompany abided by the anti-money laundering (AML) provisions of the Bank Secrecy Act(BSA). Concurrently, FinCEN’s representative, the U.S. Attorney’s Office for the Southern District of New York (SDNY), today filed a complaint in U.S. District Court that seeks to enforce the penalty and to enjoin Mr. Haider from employment in the financial industry. This CMP is the product of a joint investigation by FinCEN and the SDNY. From 2003 to 2008, Mr. Haider was the Chief Compliance Officer for MoneyGram International Inc. Mr. Haider oversaw MoneyGram’s Fraud Department, which collected thousands of complaints from consumers who were victims of fraudulent schemes. Mr. Haider also headed MoneyGram’s AML Compliance Department, which was charged with ensuring compliance with requirements under the BSA designed to protect the financial system against money laundering and terrorist finance. “In my job, I’ve met hundreds of compliance officers and I know them to be some of the most dedicated and trustworthy professionals in the financial industry,” said FinCEN Director Jennifer Shasky Calvery. “FinCEN and our law enforcement partners greatly depend on their judgment and their diligence in our common fight against money laundering, fraud, and terrorist finance. Mr. Haider’s failures are an affront to his peers and to his profession. With his willful violations, he created an environment where fraud and money laundering thrived and dirty money rampaged...
US State Bank Supervisors Issue Model Regulation for Digital Currencies

US State Bank Supervisors Issue Model Regulation for Digital Currencies

The Conference of State Bank Supervisors (CSBS) has released a draft proposal for regulating digital currency businesses. The membership group, which represents bank regulators from US state agencies but does not play a direct role in how states craft new financial rules, outlined a number of areas in which it believes companies that work with digital currencies should be supervised, including approaches to consumer protection, licensing and security. Overall, the framework echoes elements of the New York State Department of Financial Services’ (NYDFS) BitLicenseproposal. The draft framework targets those who exchange digital currencies or facilitate such activities, and explicitly identifies itself as “technology neutral”. The CSBS suggests licensing and supervision requirements should apply to businesses that exchange virtual currency for fiat currency and virtual currency for other types of virtual currency; transmit virtual currencies; and facilitate the third-party exchange, storage or transmission of virtual currencies. The latter category is defined to include wallets, vaults, kiosks, merchant-acquirers and payment processors. The draft continues: “For financial services, these activities-based regulations already exist in most state laws, generally covering the transmitting, exchanging, and/or holding of value on behalf of another. Such financial transactions or services place the activity provider in a position of trust. This position of trust is the basis for most financial services laws and regulations, and should be applied regardless of the medium of value.” The CSBS has held several meetings in the past year, which garnered participation from both regulators and members of the cryptocurrency industry. During those hearings, both the promise and challenges of the technology underlying bitcoin were explored, eliciting both positive and negative reactions from the CSBS representatives leading the talks....
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