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Banker's Toolbox, Inc., leaders in compliance solutions for financial institutions, announced the acquisition of Georgia-based MainStreet Technologies (MST). MST is an industry leader in the loan risk management space. This acquisition adds to a strong and growing portfolio of compliance-related solutions and will continue to enhance the value Banker's Toolbox brings to both their customers and the industry. (Read full press release here.)

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Fed bars two former Regions Bank employees

The Federal Reserve Board has announced it has issued consent orders of prohibition to a former branch manager and to a former finance services specialist of Regions Bank (Birmingham, Alabama), for engaging in improper practices regarding credit origination. The two individuals were found to have falsified income on credit applications to qualify applicants for loans on which they earned incentive payments.


OFAC targets Iranian supporters of Yemeni terrorists

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has designated five Iranian individuals who have provided ballistic missile-related technical expertise to Yemen’s Huthi terrorists, and who have transferred weapons not seen in Yemen prior to the current conflict, on behalf of the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF). For identification information on the five targeted individuals, see our OFAC Update.

As a result of these actions, all property and interests in property of those designated today subject to U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with them. In addition, foreign financial institutions that knowingly facilitate significant transactions for, or persons that provide material or certain other support to, the individuals and entities designated today risk exposure to sanctions that could sever their access to the U.S. financial system or block their property and interests in property under U.S. jurisdiction.


Executive Order regarding Venezuelan transactions

The President has issued an Executive Order, "Prohibiting Certain Additional Transactions with Respect to Venezuela." All transactions related to, provision of financing for, and other dealings in the following by a United States person or within the United States are prohibited:

  • the purchase of any debt owed to the Government of Venezuela, including accounts receivable;
  • any debt owed to the Government of Venezuela that is pledged as collateral after the effective date [12:30 p.m. EDT on May 21, 2018] of the order, including accounts receivable; and
  • the sale, transfer, assignment, or pledging as collateral by the Government of Venezuela of any equity interest in any entity in which the Government of Venezuela has a 50 percent or greater ownership interest.


OFAC targets Venezuelan corruption network

OFAC announced on Friday it has designated Diosdado Cabello Rondón (Cabello), for being a current or former official of the Government of Venezuela. OFAC also designated three other individuals (one with addresses in the U.S.) for being current or former officials, or for acting for or on behalf of designated individuals as key figures in the Cabello corruption network, and three companies and 14 properties in Florida and New York owned by one of those individuals. Identifying information is available in our May 18 OFAC Update.


Treasury targets Hizballah financing network and Iranian conduit

Treasury's Office of Foreign Assets Control has designated Hizballah financier Mohammad Ibrahim Bazzi and Hizballah’s representative to Iran Abdallah Safi-Al-Din as Specially Designated Global Terrorists (SDGTs) pursuant to Executive Order 13224, which targets terrorists and those providing support to terrorists or acts of terrorism. Also designated on Thursday as SDGTs are five companies located in Europe, West Africa, and the Middle East for being owned or controlled by Mohammad Bazzi and another SDGT. For identity information on the individuals and companies targeted by OFAC's actions, see our OFAC Update.


Brokerage firms charged with AML laundering

The SEC has announced the settlement of charges against broker-dealers Chardan Capital Markets LLC and Industrial and Commercial Bank of China Financial Services LLC (ICBCFS) for failing to report suspicious sales of billions of penny stock shares. Broker-dealers are required to file Suspicious Activity Reports (SARs) for transactions suspected to involve fraud or with no apparent lawful purpose. According to the SEC, from October 2013 to June 2014, Chardan, an introducing broker, liquidated more than 12.5 billion penny stock shares for seven of its customers and ICBCFS cleared the transactions. Chardan failed to file any SARs even though the transactions raised red flags, including similar trading patterns and sales in issuers who lacked revenues and products. The SEC found that ICBCFS similarly failed to file any SARs for the transactions despite ultimately prohibiting trading in penny stocks by some of the seven customers.


OFAC sanctions Hizballah's senior leadership

Yesterday, in partnership with Saudi Arabia and the other member nations of the Terrorist Financing and Targeting Center, OFAC designated members of Hizballah’s Shura Council, the primary decision-making body of Hizballah. For details on the designees, see our OFAC Update.


FinCEN delays Beneficial Ownership rule for rollovers and renewals

On Wednesday, five days after the effective date of its Beneficial Ownership Requirements rule, FinCEN issued Administrative Ruling 2018-R002, granting a 90-day limited exceptive relief to covered financial institutions with respect to certificates of deposit and loan accounts that automatically roll over or renew that were established before May 11, 2018. The 90-day relief period started on May 11 and will end on August 9, 2018. The ruling says that, during this time, "FinCEN will determine whether and to what extent additional exceptive relief may be appropriate for such financial products and services that were established before May 11, 2018, but are expected to rollover [sic.] or renew after such date."

Editor's Note: The "exceptive relief" provided by FIN-2018-R002 extends only to certificates of deposit and loans that automatically rollover or renew. Loan renewals that are not automatic are not covered, and currently are subject to Beneficial Ownership requirements. They are covered, however, by Question 12 in FinCEN's April 3, 2018, Guidance FAQs (FIN-2018-G001).


Fed Governor Brainard on digital currencies

Federal Reserve Board Governor Lael Brainard spoke on "Cryptocurrencies, Digital Currencies, and Distributed Ledger Technologies: What Are We Learning?" at yesterday's session of the Decoding Digital Currency Conference sponsored by the Federal Reserve Bank of San Francisco.


OFAC targets Iraqi bank and four individuals

Treasury has announced that OFAC has imposed sanctions on the Governor and a senior official of the Central Bank of Iran, an Iraq-based bank and its chairman, and a key Hizballah official, all of whom have moved millions of dollars on behalf of the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF) to Hizballah. They were designated as Specially Designated Global Terrorists (SDGTs) pursuant to Executive Order 13224, which targets terrorists and those providing support to terrorists or acts of terrorism.

For identification information on the Iraq-based bank and the four individuals sanctioned by OFAC's action, see our OFAC Update.


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