Uncle Sam swoops on Mexican banks
The biggest money-laundering investigation ever carried out by the US authorities cast its net wide. Operation Casablanca uncovered trails in Colombia, Mexico and Venezuela and indicted some highly respectable banks. Some have now launched internal investigations into what went wrong. But how much are banks to blame when money laundering goes on under their roofs? Michelle Celarier reports.
Senior executives of Bancomer in Mexico City are unlikely to forget the morning of May 18 when the call came through from the US justice department. Along with two other prominent Mexican financial institutions, and scores of bankers, Bancomer was being indicted on US conspiracy and money-laundering charges. Within a few hours, US treasury secretary Robert Rubin would announce the biggest ever federal money-laundering investigation - and the first US money-laundering indictments against legitimate foreign financial institutions.
Known as Operation Casablanca, the investigation took almost three years and was so circumspect it was done without the knowledge of Mexican public servants. Three big Mexican banks were indicted - Bancomer, Banca SerfIn, and Banca Confía. Bancomer and Serfín are the country's second- and third-largest banks. All three have significant foreign ownership stakes - held by the Bank of Montreal, HSBC and Citibank, respectively.
Ordered to desist
Twenty-six Mexican and five Venezuelan bankers, among others, were also indicted on money-laundering charges. On June 11, treasury undersecretary of enforcement Raymond Kelly told a house banking committee hearing that $100 million of the dirty money had been seized, and 167 individuals arrested. He also said the investigation is continuing.