The Financial Crimes Enforcement Network ordered Bancrédito International Bank and Trust Corp. to pay $15 million to resolve an investigation into alleged Bank Secrecy Act violations, the agency announced Friday.
Bancrédito failed to timely file suspicious activity reports between October 2015 and May 2022; failed to establish a due diligence program for correspondent accounts managed in the U.S.; and failed to implement and maintain an anti-money laundering program, FinCEN said.
Bancrédito inadequately monitored the transfer of funds from accounts linked to Panamanian bank servicing companies and individuals in Panama and Venezuela, according to the consent order. The transactions also included activity by a Bancrédito executive, FinCEN said.
Bancrédito was founded in 2008 by Julio Velutini, a citizen of Venezuela and Italy. The bank aimed to serve foreign banks in Central America and the Caribbean.
Velutini turned himself in to authorities in August 2022, after he was accused of bribing Puerto Rico’s now-former Gov. Wanda Vazquez to undermine an investigation into his bank. Vazquez was arrested around that time, and accused of accepting campaign bribes.
“Bancrédito processed millions of dollars in suspicious transactions through the United States on behalf of high-risk customers, providing correspondent accounts to foreign financial institutions without the required due diligence and reporting required by the BSA,” FinCEN Director Andrea Gacki said in a statement. “With today’s action, FinCEN is sending the message that the era of easy money laundering through Puerto Rican [international banking entities] is over.”
The penalty marks the first enforcement action against a Puerto Rican IBE under the so-called gap rule, which took effect in March 2021 to make banks abide by the AML rules when servicing international financial institutions, FinCEN said.
Under FinCEN’s order, Bancrédito must surrender its license to operate in the U.S. as an IBE and preserve all business records related to BSA compliance.
Bancrédito’s holding company, however, threatened to take legal action against FinCEN, calling the enforcement action “unjustified,” The Weekly Journal reported.
Bancrédito was seized in January by its primary regulator, the Office of the Commissioner of Financial Institutions.