Check Cashing Company, Executives Plead Guilty To AML Charges

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On November 5, the DOJ announced that a New York check cashing company and its owner pleaded guilty to violating the Bank Secrecy Act in connection with more than $19 million in check-cashing transactions by willfully failing to maintain an effective anti-money laundering program. The plea agreement requires the company to forfeit over $3 million and the owner to pay nearly $1 million in restitution for related tax violations; neither party has yet been sentenced. The DOJ alleges that over a two-year period the company cashed checks written on accounts of shell corporations. The shell corporations and the corresponding bank accounts on which the checks were written were established in the names of foreign nationals, many of whom were no longer in the United States. The check cashing company and its owner allegedly failed to obtain any identification documents or information from the individuals presenting the checks, filed false currency transaction reports (CTRs) that stated the checks were cashed by the foreign nationals who set up the shell corporations, and in certain CTRs, failed to indicate the full amount of cash provided to the individuals. Related charges remain pending against additional defendants. These cases are being prosecuted by, among others, the DOJ’s Money Laundering and Bank Integrity Unit, which investigates and prosecutes complex, multi-district and international criminal cases involving financial institutions and individuals who violate the money laundering statutes, the Bank Secrecy Act and other related statutes.