FinCEN Penalizes Bank for Failing to Report Suspicious Activity Tied to Judicial Corruption

canstockphoto4553522(Jeff Sorg, OnlineEd) Washington, DC – The Financial Crimes Enforcement Network (FinCEN) assessed a $1.5 million civil money penalty against the First National Community Bank of Dunmore, Pennsylvania (FNCB) for willfully violating the Bank Secrecy Act (BSA). The Bank admitted that it failed to file suspicious activity reports on transactions involving illicit proceeds from a judicial corruption scheme – spanning over five years – for which Michael Conahan and Mark Ciavarella, both former Pennsylvania judges, were ultimately convicted. Conahan and Ciavarella misused their positions as judges to profit from, among other things, sending thousands of juveniles to detention facilities in which they had a financial interest. Conahan was on FNCB’s board of directors and controlled accounts at the Bank through which he processed the proceeds of his illegal activity. Despite several red flags indicating suspicious activity, FNCB did not file a single suspicious activity report related to these accounts until after Conahan’s first guilty plea in 2009. “The criminal case affected the lives of thousands of children and parents,” noted FinCEN Director Jennifer Shasky Calvery. “Banks have a duty to spot suspicious activity and to report it. Law enforcement relies on this valuable information. FNCB’s failure to file timely suspicious activity reports may have deprived law enforcement of information valuable for tracking millions of dollars in related corrupt funds.”

“The criminal case affected the lives of thousands of children and parents,” noted FinCEN Director Jennifer Shasky Calvery. “Banks have a duty to spot suspicious activity and to report it. Law enforcement relies on this valuable information. FNCB’s failure to file timely suspicious activity reports may have deprived law enforcement of information valuable for tracking millions of dollars in related corrupt funds.”

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  This article was published on February 28, 2015. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

Categories: Mortgage
Jeff Sorg

About the Author

Jeff Sorg is a co-founder of OnlineEd®, a Web-based vocational school founded in 1997 where he also serves as Corporate Secretary, Chief Operating Officer, and School Director. Sorg holds vocational instructor licenses in Oregon, Washington, California, and Nevada and has authored numerous pre-licensing and continuing education courses. Sorg was awarded the International Distance Education Certification Center's CDEi Designation for distance education in 2008. OnlineEd® provides real estate, mortgage broker, insurance, and contractor pre-license, post-license, continuing education, career enhancement, and professional development and designation courses over the Internet.