Enforcement Actions And Terminations Of Previous Actions - Federal Reserve Board - Brief Article

Federal Reserve Bulletin, May, 2000

The Federal Reserve Board on March 3, 2000, announced the issuance of a prompt corrective action directive against the New Century Bank, Southfield, Michigan.

The Federal Reserve Board on March 9, 2000, announced the execution of a written agreement by and between Banco Popular de Puerto Rico, Hato Rey, Puerto Rico, and the Federal Reserve Bank of New York.

The Federal Reserve Board on March 17, 2000, announced the issuance of a consent order against Sunshine Financial and Frederick K. Wall, institution-affiliated parties of the First Western Bank, Cooper City, Florida, a state member bank.

The parties, without admitting to any allegations, consented to the order to resolve allegations that they violated the Change in Bank Control Act in connection with the acquisition of beneficial ownership of the shares of the bank.

The Federal Reserve Board on March 17, 2000, announced the issuance of an order of prohibition against Vinay B. Malhotra, a former vice president and officer of the Chicago Branch of The Bank of Tokyo-Mitsubishi, Ltd., Tokyo, Japan.

Mr. Malhotra, without admitting to any allegations, consented to the issuance of the order due to his alleged breach of fiduciary duties and misapplication of bank funds for his personal benefit.

The Federal Reserve Board on March 17, 2000, announced the issuance of a consent order against the R&T Foundation and James R. Sellers, institution-affiliated parties of the First Western Bank, Cooper City, Florida, a state member bank. The parties, without admitting to any allegations, consented to the order to resolve allegations that they violated the Change in Bank Control Act in connection with the acquisition of beneficial ownership of the shares of the bank.

The Federal Reserve Board on March 22, 2000, announced the execution of a written agreement by and between the Security Dollar Bank, Niles, Ohio, and the Federal Reserve Bank of Cleveland.

The Federal Reserve Board announced on March 13, 2000, that it had terminated the temporary orders to cease and desist issued against Banco Nacional de Mexico, Mexico City, Mexico; Banco Internacional, S.A., Mexico City, Mexico; and Banco Santander, Madrid, Spain.

The temporary orders to cease and desist were issued on May 18, 1998, in connection with Operation Casablanca, a law enforcement undercover operation that resulted in numerous convictions of drug traffickers, bankers, and two foreign banking organizations with operations in the United States for money-laundering offenses.

Banco Nacional de Mexico, Banco Internacional, S.A., and Banco Santander were not charged with any criminal activity in connection with Operation Casablanca.

The temporary orders to cease and desist required Banco Nacional de Mexico, Banco Internacional, S.A., and Banco Santander to enhance their anti-money-laundering policies and procedures in the United States. The banks have been in full compliance with the temporary orders.