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US Treasury to lead review of anti-money laundering rules

Published on Nov 13, 2012 8:43 AM

WASHINGTON (Reuters) - The Obama administration will review a sprawling net of anti-money laundering rules and seek to correct "gaps, redundancies or inefficiencies," in the U.S. system now more than 40 years old, the Treasury Department's top official overseeing the issue said on Monday.

David Cohen, Treasury undersecretary for terrorism and financial intelligence, said the department had launched an anti-money laundering task force along with federal regulators and law enforcement agencies. The initiative comes as federal authorities crack down harder on anti-money laundering lapses, with high profile cases against financial institutions.

In 2010, the Wachovia Bank unit of Wells Fargo & Co agreed to pay US$160 million (S$195 million) to settle charges that its weak compliance with the rules allowed the laundering of Mexican drug money. HSBC, which is under investigation by a slew of U.S. government agencies, announced earlier this month that it could face fines in excess of US$1.5 billion for anti-money laundering lapses that reportedly permitted it to take in large sums of drug money in Mexico and other compliance failures.

Such enforcement only shows signs of increasing. A Justice Department official said in August that prosecutors plan to step up their efforts to target financial institutions that fail to meet their anti-laundering obligations.

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