This is an interesting story from the WSJ. The feds are probing the bank — and others — for violations of money laundering laws, specifically involving Mexican and Colombian drug money.
Now, let’s be clear. There is money laundering — actively converting proceeds from criminal acts to plain vanilla commercial proceeds — and there are technical violations of numbingly complex federal banking laws. Essentially the feds have moved to criminalize entire categories of cash transactions absent the timely filing of the proper reports.
Those are suspicious-activity reports, the use of which has exploded since 9/11. At the same time banks have rolled out software to sniff every single transaction they process, the better to uncover the kind of “structuring” that tripped up New York Gov. Eliot Spitzer and his call-girl fun.
Given all of this background and know none of the specifics, it surely sounds like the feds think Wachovia and other banks should be more pro-active in digging out outrigger transactions. In other words, report everything.
