Monday, August 22, 2011
Is Your Bank on This Severe Enforcement List? By Geniusofdespair
When you consider that 1) a bank has to put in new anti-money laundering systems (Ocean Bank), 2) 32% of Florida based based banks are currently operating under severe regulatory enforcement and 3) Florida led the nation in bank failures in 2010 with 29 (all according to a report in the Miami Herald) you have to wonder if we Floridians have all lost our collective minds. I guess we have, two words prove it: Rick Scott.
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2 comments:
US Century tends to attract a lot of attention, due to its high profile board members, however the allegations that are being levels by the US State Attorney's office, plus the FDIC and FICEN against Ocean Bank are even worse. In fact, they're criminal in nature and involve laundered drug monies. Keep in mind that this is a bank that has $3.5 billion in total assets, making it WAY larger than US Century.
This is something that you folks should look into, as OB's depositor base is strongest in Miami-Dade County.
The Wall Street Journal and other national periodicals are also running with the story at Ocean Bank. It just came out a few hours ago. Far bigger than anything at USCB. Given their low capital ratios, this could mean that their demise is imminent. Can't dismiss the possibility of criminal or civil charges, especially against ex-CEO Jose Concepcion or the current CEO (who is also the 95% shareholder in the bank) Alfonso Macedo. They willfully ignored BSA as an inconvience, and are now going to pay the price.
The South Florida Business Journal has a nice summary of it, and the FDIC just release a bill of charges, along with FICEN's analysis, which is highly recommended reading. There's no way they can fix this BSA problem. At the core of their problem is the fact that it's impossible to track down international depositors who don't leave addresses or any supporting documentation with the bank.
They have well over a billion dollars in accounts of this nature. They can't close them because there is no return address to send back the funds! So they're stuck between a rock and a hard space. They can't get into compliance with BSA laws by no means.
The bank's former CEO and even ownership supported these policies. It would not come to much surprise if it comes out that this part of a broader money laundering operation within the bank itself, as many of activities highlighted within the government's allegations lend itself to such funny business.
In short, this goose is cooked. The government here gave what amounts to an ultimatum: either agree to the settlement terms and liquidate the bank, or management and ownership goes to jail. Tough stuff.
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