WASHINGTON -- More than $900,000 in fines was collected from seven violators of the Bank Secrecy Act from May to September, the government announced last week.
"These penalties send a strong message that the Treasury Department is committed to fighting money laundering and other financial crimes," Treasury Secretary Lloyd Bentsen said in a statement.
Mark Twain Bank, St. Louis, was hit with the largest fine: $750,000. The bank failed to file currency transaction reports from Oct. 1988 to March 1994. Previous exams by the Federal Deposit Insurance Corp. and several internal audits had noted deficiencies in compliance.
However, Treasury said Mark Twain's cooperation, including improvements to the bank's training and auditing program, helped reduce the penalty.
Since 1974, banks and non-banks have been required to file Bank Secrecy Act reports with the Treasury on cash transactions of $10,000 or more.
"Our first line of defense is an effective Bank Secrecy Act program that ensures a viable paper trail of financial transactions and adequately identified customers," Mr. Bentsen said. "Treasury will continue to hold financial institutions accountable when they fail to comply with the act."
The First National Bank of Chicago Heights, Ill., was fined $20,000 for failing to file currency transaction reports in 1988.
In determining its penalty, Treasury said it considered a change in the bank's management since the time of the violations.
The Jonestown Bank and Trust Co., Jonestown, Pa., paid a $12,500 penalty for not filing reports on time.
Treasury also considered a change in bank management and improvements to the bank's compliance program since the violations.
"Management involvement in the compliance process is a key element to the success of a comprehensive Bank Secrecy Act compliance program," said Stanley E. Morris, director of Treasury's Financial Crimes Enforcement Network.
Secrecy act-violations were found at LaSalle National Bank, LaSalle, Ill., during an internal audit. LaSalle paid $5,000 for not filing currency transaction reports on time. The Treasury praised the bank for voluntarily disclosing the violations.
"I compliment the bank on its voluntary notification of and cooperation with Treasury on this matter," said Mr. Morris.
A penalty of $5,000 against the New Damen Grand Currency Exchange, a check cashing service in Chicago, was levied for its failure to file a currency transaction report in 1987.
The violation involved multiple checks cashed concurrently for a single customer. Mr. Morris said this penalty reflects Treasury's effort to enforce compliance by nonbanks as well as banks.
Another nonbank, the Claridge Casino Hotel in Atlantic City, paid $120,000 for not reporting currency transactions to the Internal Revenue Service during late 1985 and in October 1987.
The final penalty, against Public Employees Credit Union, Austin, Tex., was $2,000 for not filing a report in 1988. The violation involved a withdrawal from a credit union employee's account.
"Reporting failures, whatever their cause, are extremely serious," said Ronald K. Noble, under secretary for enforcement at the Treasury. "This impairs our ability to monitor potentially suspect conduct and frustrates Treasury efforts to close the doors of all financial institutions, including casinos, to the activities of money launderers, tax evaders, and other perpetrators of financial crime who prey on such institutions."
