The Financial Crimes Enforcement Network (FinCEN) brought a $1 million civil money penalty action against former MoneyGram Chief Compliance Officer Thomas Haider. MoneyGram is in the business of wire transfers. MoneyGram had entered into a deferred prosecution agreement with the Department of Justice (DOJ) for violating AML rules. In December, 2014 FinCEN brought an action against Haider seeking to find him individually liable on the ground that he was responsible for implementing and operating MoneyGram’s AML program.
Haider filed a motion to dismiss in a federal district court in Minnesota on the grounds that he could not be held liable under the BSA because that law requires regulated financial institutions not individuals to establish AML programs. The court rejected the argument. Since the BSA authorizes FinCEN to impose civil penalties, the court reasoned that it could bring actions against individuals.
As a result of the court’s ruling, the matter will proceed to trial. At the trial, the merits of FinCEN’s administrative action will be at issue. FinCEN had found:
• Haider received reports of suspicious behavior but failed to include that information in any SARs;
• his department created no discipline policy for agents even though Haider personally knew certain offices were involved in money laundering;
• Haider failed to terminate agents known to be at high risk for money laundering; and
• Haider failed to ensure that robust and independent audits were carried out at MoneyGram’s various outlets.