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OCC reports unauthorized removal of information

The OCC has announced it has notified Congress and other federal agencies of a major information security incident, as required by the Federal Information Security Modernization Act (FISMA). The incident involves a former OCC employee who downloaded a large number of files onto two removable thumb drives prior to his retirement and, when contacted, was unable to locate or return the thumb drives to the agency.


India call center scam targeted US victims

ICE has announced that 61 individuals and entities have been charged in a Federal court indictment for their alleged involvement in a transnational criminal organization that victimized tens of thousands of people in the United States, resulting in hundreds of millions of dollars in losses. The indictment alleges that the defendants were involved in a sophisticated fraudulent scheme organized by conspirators in India, including a network of call centers in Ahmedabad, India. Using information obtained from data brokers and other sources, call center operators allegedly called potential victims while impersonating officials from the IRS or U.S. Citizenship and Immigration Services. According to the indictment, the call center operators then threatened potential victims with arrest, imprisonment, fines or deportation if they did not pay taxes or penalties to the government. If the victims agreed to pay, the call centers would then immediately turn to a network of U.S.-based co-conspirators to liquidate and launder the extorted funds as quickly as possible by purchasing prepaid debit cards or through wire transfers. The prepaid debit cards were often registered using misappropriated personal identifying information of thousands of identity theft victims, and the wire transfers were directed by the criminal associates using fake names and fraudulent identifications. The co-conspirators allegedly used “hawalas,” in which money is transferred internationally outside of the formal banking system, to direct the extorted funds to accounts belonging to U.S.-based individuals. According to the indictment, these individuals were expecting the hawala transfers but were not aware of the illicit nature of the funds. The co-conspirators also allegedly kept a percentage of the proceeds for themselves.


OCC to host workshops in Philly

The OCC will host two workshops in Philadelphia at the Sheraton Suites Philadelphia Airport, December 6-7, for directors of national community banks and federal savings associations supervised by the OCC. The Risk Governance workshop on December 6 combines lectures, discussion, and exercises to provide practical information for directors to effectively measure and manage risks. The workshop also focuses on the OCC’s approach to risk-based supervision and major risks in the financial industry. The Compliance Risk workshop on December 7 combines lectures, discussion, and exercises on the critical elements of an effective compliance risk management program. The workshop also focuses on major compliance risks and critical regulations. Topics of discussion include the Bank Secrecy Act, Community Reinvestment Act, and the Truth-in-Lending (TILA) and the Real Estate Settlement Procedures Act of 1974 (RESPA) Integrated Disclosures Rule, also known as TRID.


OFAC sanctions nine Mexicans tied to drug traffickers

Treasury has announced that its Office of Foreign Assets Control (OFAC) has sanctioned nine Mexican individuals linked to the Cartel de Jalisco Nueva Generacion (CJNG) and its close ally, the Los Cuinis Drug Trafficking Organization (DTO), which were initially sanctioned on April 8, 2015. The nine individuals are designated as Specially Designated Narcotics Traffickers (SDNTs) pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act) for providing material assistance to the drug trafficking activities of Nemesio Oseguera Cervantes (a.k.a. “Mencho”) and his brother-in-law, Abigael Gonzalez Valencia, the respective leaders of CJNG and the Los Cuinis DTO. As a result of today’s action, any assets these individuals may have under U.S. jurisdiction are frozen, and U.S. persons are generally prohibited from engaging in transactions with them. See our OFAC Update for further details.


FinCEN issues cyber-crime FAQs and Advisory

The Financial Crimes Enforcement Network (FinCEN) has issued Frequently Asked Questions (FAQs) regarding the reporting of cyber-events, cyber-enabled crime, and cyber-related information through Suspicious Activity Reports (SARs). In addition, an Advisory has been issued on cyber-events and cyber-related crime.


Payments task force seeks comments

The Federal Reserve's Secure Payments Task Force, a 160-member task force convened by the Federal Reserve System to advance the safety, security and resiliency of the national payment system, is asking the industry for comments on its efforts to enhance payment identity management, data protection, and information sharing related to payments risk and fraud. The Task Force has been working across payment industry segments to define challenges and develop potential solutions. Online surveys have been created to gather comments on how the task force is addressing challenges related to the three focus areas. The goal is to help ensure that the solutions being pursued will meet industry needs. The survey will be open for comment through, November 8, 2016.


NCUA Report: Ransomware threat is growing

The NCUA has published the October 2016 issue of The NCUA Report, in which the regulator’s Office of Small Credit Union Initiatives details what ransomware is and the increasing role it plays in cyberattacks against smaller financial institutions. The article also provides resources that credit unions can use to prevent and respond to these attacks.


Latest FATF releases

The Financial Action Task Force (FATF) has released the outcomes of its Plenary held October 19-21, 2016. Delegates discussed, among other issues, the global response to terrorist financing, the decline of correspondent banking relationships, improving transparency and beneficial ownership, and the mutual evaluation reports of Switzerland and the United States (to be released after reviews for quality and consistency). New FATF Guidance documents were also released — one on Criminalizing Terrorist Financing, which explains the various aspects that the terrorist financing offense must cover in national legal systems; and the other on Correspondent Banking Services, which explains the FATF’s requirements in the context of correspondent banking services to manage, rather than avoid, the money laundering and terrorist financing risks associated with these business relationships.


Dallas woman convicted of stolen identity scheme

ICE has reported that a federal jury has convicted a Dallas woman of stealing personal identifying information, using that information to fraudulently obtain income tax refunds, and laundering those funds. She and her co-conspirators were involved in a scheme in which they filed false tax returns using stolen identities, some of which belonged to incarcerated individuals. They converted the tax refunds from debit/Green Dot cards, using shell-company bank accounts, into cash and cashier’s checks.


Treasury sanctions Hizballah financiers and operatives

The U.S. Department of the Treasury has taken action to disrupt the operations, fundraising, and support networks of Hizballah by designating four individuals and one entity pursuant to Executive Order (E.O.) 13224, which targets terrorists and those providing support to terrorists or acts of terrorism. As a result of that action, 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. Additional information is available in BankersOnline's OFAC Update


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