Bank of America has hired two US government officials to join its financial crimes team, according to three people familiar with the matter, as banks are under increasing pressure to police their transactions for suspicious activity. Bank of America has hired Jaikumar Ramaswamy, who heads the US Justice Department's asset forfeiture and money laundering section, and Frederick Reynolds, who is deputy director of the Treasury Department's anti-money laundering unit, the Financial Crimes Enforcement Network (FinCEN).
Ramaswamy and Reynolds will join the bank in January and will report to the global head of financial crimes compliance, Bill Fox, a former director of FinCEN. Their precise roles have not yet been determined, said the sources, who declined to be identified because they were not authorised to speak publicly. A spokesman for Bank of America declined comment. Neither Ramaswamy nor Reynolds immediately responded to requests for comment.
Banks face increasingly steep penalties for failing to flag transactions for possible money laundering or corruption risks, or those that could violate US sanctions on other countries. British bank Standard Chartered agreed to pay a $300 million penalty from the New York state bank regulator in August for failing to weed out risky transactions that could be linked to money laundering.
The settlement came on top of $667 million in penalties the bank agreed to pay in 2012 to resolve similar charges. In July, Bank of America's banking unit agreed to pay $16.6 million to resolve allegations that it processed several hundred transactions for drug traffickers subject to US sanctions. Ramaswamy has led the anti-money laundering unit at the Justice Department since 2012, and oversaw the largest such case in which French bank BNP Paribas pleaded guilty in July and paying nearly $9 billion in penalties to resolve charges that it violated embargoes against Sudan, Cuba and Iran. Reynolds, a former prosecutor who worked on civil and criminal forfeiture cases, has played a key role in a recent reorganisation of FinCEN's enforcement unit.
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