The Financial Crimes Enforcement Network (FinCEN) Tuesday fined a money transfer business based in Hamtramck, Michigan and its owner for processing millions of dollars in wire transfers to Yemen without any due diligence on those involved.
King Mail & Wireless Inc. and its owner, Ali Al Duais, who also served as the firm’s designated compliance officer under the Bank Secrecy Act (BSA), admitted willful and repeated violations of the BSA and agreed to pay a fine of $12,000.
King Mail is no longer in business.
FinCEN barred Al Duais permanently from serving as an employee, officer, director, or agent of any financial institution located or conducting business in the United States.
In its final order (pdf), FinCEN said King Mail had no written anti-money laundering program.
“Therefore, it had no policies, procedures, and internal controls (1) to monitor, detect and report suspicious activities and (2) to obtain and retain required identification information for fund transfers of $3,000 or more. This led to serious BSA failures.”
An IRS examination of a six-month period showed that King Mail completed 2,606 “Send” transactions to Yemen for a total dollar amount of $2.7 million.
Those transactions raised a number of “red flags,” such as dollar amounts inconsistent with family support, large amounts sent within a short period of time, large dollar amounts that had no apparent business or lawful purpose, transactions sent to multiple beneficiaries in different locations in Yemen, and multiple sends within one business day below the recordkeeping threshold.
Despite the red flags, King Mail never did any due diligence or transaction monitoring. During its entire time in operation as a business, FinCEN said, it didn’t file a single Suspicious Activity Report or a Currency Transaction Report.
Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.