Wachovia Bank investigated for laundering drug money to Mexico and Colombia
Recently I’ve noted the “alarming” success of cracking down on employers who have illegal aliens on their payroll. There’s another investigation brewing that, though it may not be intended to do so, may have some long-term effects in cross-border relations.
Immigrants, legal and illegal, remit a great deal of money back to their home countries. These remittances are Mexico’s second-greatest source of foreign currency and make up 3% of its GDP. Often immigrants send their money using exchange houses, or “casas de cambio”.
U.S. Banks have tried to get a piece of this remittance action, sometimes partnering with the casas de cambio, and have repeatedly shown themselves willing to look the other way when the money flowing south comes from a different sort of agriculture than lettuce-picking. The latest bank under scrutiny is Wachovia, and the WSJ has a detailed report about them, though a carefully phrased one that skirts the controversial immigration issues. (Like most WSJ news stories, it requires a subscription, but like most WSJ stories, you can reach it free through Google News.)
Wachovia built up its ties to casas de cambio as a way to tap the Hispanic market, which doesn’t always bank through traditional Main Street outlets. [Heh. --See-Dub] Wachovia served as a larger partner, holding the foreign-exchange houses’ deposits and providing back-office services. In 2005, it introduced the Dinero Directo card to facilitate cross-border remittances.
The bank pushed into the business despite well-publicized concerns from U.S. law enforcement that such firms were sometimes used to launder drug money. Wachovia declined to discuss why it pursued this business despite the warnings.
Internal emails and documents filed in federal courts in Miami, Chicago and New York describe former ties between Wachovia and money-changing firms. In a case in U.S. court in Miami, federal agents seized more than $11 million in 23 Wachovia accounts belonging to Casa de Cambio Puebla…Mexican police raided Puebla offices last fall, alleging relationships with a major drug cartel.
Looks like a lot of banks have fallen to this temptation:
I can’t say I’m surprised; many of these banks got into this business knowing they were inevitably going to facilitate the transfer of “gray” money–the wages of illegal labor. There’s little incentive (other than Federal prosecution) to look too closely at where the money comes from, and whether a little “black” money from the drug trade got thrown in the laundry as well.
It seems to me that a reasonable precaution for the Federal government to add to the international transaction business is to require senders to show proof of citizenship or legal residency. I’ve sent money internationally through Western Union, and you already have to show ID. So if you can’t prove you’re here legally, why should you be allowed to use the Federally-insured and regulated banking system to send money abroad? Likewise, why should Casas de Cambio and the like be allowed to use banks, if they don’t have this basic safeguard in place?
That measure won’t, of course, directly discourage the big drug runners and money launderers, who will still find ways around it. But it will remove from the legit banks the temptation to facilitate illegal alien banking, and encourage them to keep scrutinizing suspicious transfers instead of looking the other way. And it will likewise remove some of the temptation for illegal aliens to come here for work. If they can’t send money back home, why bother coming to America at all?
I don’t think such a measure would even have to go through Congress. Could just be an executive-agency change.
Yeah, I know, dream on.
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P.S.: Commenter Wise_man reminds us of Bank of America’s special credit card for illegal aliens.
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{Post by See-Dubya}
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I was irritated when I last ordered my check registers and they had Spanish translations on them. I guess Wachovia thinks Hispanics are too dumb or lazy to realize that “Transaction Description” = “Descripcion de la Transaccion” and “Number” equals “Numero.”
“Gray” Money?!?!? It is just as illegal as money made off of drugs. It may not carry as hefty a penalty, but it IS as “Black Money” as the other.
Wachovia? Wow. Nail these people.
If there was a ‘money to mexico’ story, I would have thought that it would have been Bank Of America.
Exitus, I’m not sure it is.
Concealing the proceeds of a criminal enterprise, like a drug-trafficking ring, is in itself a separate crime–money laundering.
But if you’re just in America illegally, I don’t think sending money out of the country is in itself a crime.
Maybe it ought to be, and maybe the money-laundering statutes could be stretched to cover it, but I don’t think that’s how it is now.
# 3 wm
yep, it appears someone has decided that boa should not be the only bank to completly prosittute itself for the illegals market …
IN the last 25+ years since the truly “inflationary ’70s”, banks have been increasingly allowed to get into things they were once forbidden from.
Now since Gramm-Leach-Bliley of 1999, banks have been allowed to be involved in anything they want as long as they form a holding company.
The only thing is oversight of these new entities and other forms of financial business has lagged behind…I think deliberately.
Their attitude is “We are NOT US banks but global…we are global entities.”
Just plain greedy! I stopped doing biz with BofA when they started handing out Credit cards and loans to illegals. I will continue to stop doing biz with anyone (that I know of) that in anyway aids mexico. They are not and never will be an ally to the US.
I hope the long term effect you speak of is that the illegals will have to “hand deliver” their money in Mexico!
Anything at all for the “bottom line.” What does that tell you about the sort of greedy people who run these companies and get the multi-million dollar bonuses?
They have no shame, no consciences, which are the anti bodies to greed, so they are still able to do what they do and sleep at night. They are the spawn and pure blood master race of capitalism, which breeds this sort.
Either way it’s big money for banks in terms of fees. The fee to wire money to Mexico via Western Union or some bank is five or six times the amount you’d normally pay.
Right, and while you’re at it cap the transfer fees as well.
If we enforce our existing laws, they’ll be forced to confront their own internal problems and very well may become an important ally during that process.
But until we get tough with them, they’ll keep sidestepping their responsibilities and continue to disserve their own citizens; just as the USA is disserving us citizens via their fecklessness — and there ain’t one of the three running for POTUS that’s going to do a damn positive thing about it, just the opposite.
…Or hell, increase the fees 20 times and collect 99% as tax revenue and fix the damn bridges on the federal highways.
Impeccable timing. We had just closed our Wachovia accounts for poor customer service and switched banks. This investigation couldn’t happen to a nicer bank.
See-Dub:
I have a relative considering retiring to Costa Rica. As part of their PreMove they are reading everything they can about CR. They turned me on to a fascinating website and blog about moving to CR.
http://www.therealcostarica.com/costa_rica_business/banking_in_costa_rica.html
The link above will take you to a posting about banking in CR, it reads, in part on even opening a bank account there:
“cases you will need, at the minimum, a passport or cedula (Costa Rican ID card), 2 or more local reference letters, a letter from your US bank if you’re moving here, a cedula juridica (corporate ID) ID, a personaría (guarantee of your authority signed by a Notary (NOT just an attorney) and maybe more. Many corporate deposits most be for a minimum amount. As there are a tom of banks here and each have different, and changing rules, I will let you do the investigation.”
And this is just to OPEN a bank account!
Allow me to add, that anyone from the US can visit CR on a 90 visa, with just a US passport. Over stay that visa – BY EVEN ONE DAY – and you may not be allowed to return FOR TEN YEARS!!!
#4 see-dubya
I was talking less about the money-laundering aspect as the illegally-earned aspect. They earned the money illegally (by not being legally able to work in the US), and so they should never have had it to send down…Not sure on the technicalities of it all, but it seems that the money should be “black” as well.
It’s always good to not patronize companies that don’t deserve your money. I’ll never buy gas at Citgo because this money goes back to Venezuela and Chavez.
Too bad more people cant do this in greater numbers, so this can have a more real impact. Until then, I am satisfied that none of my money is going to sources that betray the ideals I have.
Let’s build the fence first. Then, I envision an ATM on the southern border set up on a trick one-way revolving door. It has 2 buttons–press 1 for English and press 2 for Spanish. As soon as button 2 is pressed—-SSSWWWOOOOSSSSHHHHHH!!!!!!!!
Adios.
I’ve often wondered why the war on drugs can’t be won, think it might have anything to do with banks and money? Just a question.
Wachovia is Spanish for “Gringo Money Changer”
All we need is for the law to require proof of legal presence in this country along with identification before they are allowed to transfer funds to an individual or to a financial institution outside the United States …
The bank or wire transferring agent should then be required to make a photocopy of that identification and retain those photocopies as part of the money transfer legal record …
That’s too easy dl.
aj … the best solutions usually are …
As if banks weren’t already making enough money from peddling their subprime mortgages to hedge funds. They will probably get away with this latest scheme if they
bribe enough congessmenmake enough campaign contributions.I work for a bank that recently instituted a money-wiring service for illegals. I was actually instructed by upper management to create a tracking system to the transactions (against my protests). They want to get in on the action, because “they’re going to go somewhere else, so they may as well come here”.
For as little as 5 bucks, they can remotely open up a bank account at a Mexican bank, and wire up to $9,000 dollars. All the person needs is a driver’s license.
But what bank executives fail to understand is that all it takes is a single person to open an account to process transactions for dozeens of people.
Wiseman, you beat me to it.
Maybe B of A is next on the list. They breathlessly endorse the Mexican money transfer scheme.
Hmmm…their earnings dropped 95% in January, and just last week announced a 77% drop as well.
Oh, but wait! I’m sure the government will handily come in and bail them out too.
I forgot to mention: A normal wire transfer is between 35-50 dollars. A wire transfer to Mexico is 5 dollars. We give preferential treatment to Hispanics. If that’s not a violation of the Civil Liberties Act, I don’t know what is.
This is the last straw for me. I’m going to do all my banking through my local credit union. Even here in a heavily-latino community, the credit union stays local. Period.
Lets not leave the transportation/drug smugglers out.
http://www.mcall.com/news/nationworld/state/all-a7_5drugs.6380643apr26,0,862424.story
Agreed, off the top of my head I know Western Union was more expensive when wiring to Mexico at the local Walmart. In any event, I see regulation of these fees as another way to curtail illegals.
If you can’t produce identification then make the wiring fee 25% of the sum wired.
If you want to check out the wiring fees from Western Union they’re here.
I guess the Mexicans are hopping mad about the fees.
This is probably a story of the big money whores and the little money whores. Both are whores and no matter how many times they proclaim to having gone back to being virgins they are not virgins and their top management are money whores, not business men. Much like the Bill O’Reillys of the world who just give the public what they want. You know the capitalist’s bottom line equivalency argument.
Back when Bank of America first launched their Mexican pandering campaign they hung several posters of hard working Mexicans doing the job Americans won’t do in Spanish. I complained to the manager that they were an insult to all English speaking customers but especially to other ethnic groups that have not like wise been featured. We have a large Russian immigrant population in our community that I used as an example. The posters were removed the next day but they did not remove laundering little money for illegals.
I also informed Band of America’s management that they were making it easy for illegals to launder money in increments less than $10,000 to which they informed me it was none of my business. Well as a bank customer and a B of A VISA card user I shortly made that a fact! I now bank with a small community bank and I’m a happy man using the Capital One card. B of A is not in my wallet.
rightisright said (#18):
It’s the law of supply and demand. There’s a supply and a demand.
In Charlotte and here on the southern coast of Georgia, Bank of America openly advertises for business in Spanish-language posters, etc, (you ARE supposed to be able to read, write, and speak English to become a citizen). They will open checking accounts, et al, WITHOUT much (if any) identification (they WILL accept the matricula consular issued by the Mexican government). I saw a couple who could barely speak English get a brand new checking account, and the man had only worked at a day-labor job for three months.
I asked the bank manager here why B of A hadn’t been sued for “aiding and abetting”, which they are doing to illegals. She said they were supposed to push to open new accounts for everyone, even without much (if any) identification or valid residency documents. THEY DON’T CARE. It’s about the MONEY.
One other thing: You don’t have to pay transfer fees if you are a B of A checking account customer. They’ll open your account and give you multiple ATM cards, then, once money is deposited here in the USA, relatives in Mexico can withdraw it instantly WITHOUT fees. All they have to do is locate the nearest Mexican B of A ATM machine. Or probably ANY BANK ATM in Mexico, even though they’d pay a small fee for not using a B of A machine, it would still be less than any transfer fee.
I opened an account at Naval Federal Credit Union last week to recieve my Social Security check. They spend three working days checking out things like validity of the Social Security Account Number. This should be law, not company policy.
Here is how to choose a bank that does NOT cater to illegal aliens.
Their main web page here.
Over a year ago I moved a total of 5 business and personal accounts and credit cards from BofA and Wells Fargo to one of only two banks in my state that do NOT accept the Matricula Consular card.
Top 12 banks that accept the Mexican Matricula, with the number of states they serve
State Farm 49
Bank of America 37
Wachovia 30
US Bank (Mercantile Bank) 20
Bank of The West (BNP Paribas) 18
Northern Trust 18
JPMorgan Chase 18
Wells Fargo 15
Washington Mutual 15
SunTrust 14
Charter One (Citizens Financial Group) 13
Key Bank(Key Corp) 13
Source: http://www.bankofamericaboycott.com/banklist/index.shtml
Top 12 banks that do NOT accept the Mexican Matricula (and number of states they serve)
Charles Schwab 50
Navy Federal Credit Union 23
Countrywide Bank (Treasury Bank) (Countrywide Financial) 14
Treasury Bank (see Countrywide Bank) 14
Pentagon Federal Credit Union 9
TD Bank North (TD Bank North Group, Inc)(Hudson United Bank) 8
Fort Sill National Bank 7
Commerce Online (Commerce Bancorp) 7
M&T Bank 5
North West Savings Bank (North West Bancorp MHC) 5
Susquehanna (Susquehanna Bancshares Inc) 5
Colonial Bank (Colonial Bancgroup) 5
(same source)
Wachovia = “walk all over ya”
RICO charges, anyone? The gummint can grab a ton of your stuff under RICO.
Lock up these treasonous jerks and sieze their assets. Use them both to build the dang fence. Sort of a prison work-(no)release program. If the Wachovia execs escape, just make sure that they are heading South.
My future wife and I recently closed our Wachovia accounts in Springfield, VA due to the blatant pandering towards the illegals. We’re quite happy now with the choice.
Even a broken clock is right twice a day.
The main problem with drug enforcement is that there’s a continuing demand for intoxicating substances. It’s like with Prohibition: the demand for liquor didn’t stop just because it was rendered illegal. In fact, scarcity increased demand, which brought about the growth of black market channels for its manufacture and distribution (e.g. speakeasies, bathtub mash liquor, etc).
Even when the traditional “hard” drug supply dries up, people will abuse presciption, or even over-the-counter meds like painkillers, tranquilizers, decongestants, etc.
There’s no easy solution to the problem.
I never shop at WalMart, but I had to wire money to a relative recently. The cost to wire $200 (maximum allowed) in the U.S. is something like $15. To wire money out of the country, the fee is $11 and the maximum is $500. A U.S. citizen has to send three wires for a fee of $45. An illegal immigrant can send $500 out of the country in one transfer for 1/3 the cost. Wake up America.
The one bank that I did not see on the list was Citibank – when I worked there – they had actually bought a Mexican bank to make money transfers and doing business there easier.
That’s what happens when you try and eliminate religion.