On December 18, 2014, the Financial Crimes Enforcement Network (“FinCEN”) issued a $1 million civil penalty against Thomas E. Haider, the former Chief Compliance Officer of MoneyGram International, Inc. (“MoneyGram”). In a press release announcing the assessment, FinCEN alleged that during Haider’s oversight of compliance for MoneyGram, he failed to adequately respond to thousands of customer complaints regarding schemes that utilized MoneyGram to defraud consumers. In coordination with FinCEN, the U.S. Attorney’s office in the Southern District of New York filed a civil complaint on the same day, seeking a $1 million civil judgment against Haider to collect on the assessment and requesting injunctive relief barring him from participating in the affairs of any financial institution located or conducting business in the United States.
According to the complaint, Haider was the Chief Compliance Officer of MoneyGram from 2003 to 2008 and privy to complaints received by the company’s fraud department regarding numerous fraud schemes that allegedly utilized MoneyGram to induce transfers of funds from victims. The complaint outlines claims that Haider was personally responsible for MoneyGram’s failure to meet its legal obligations under the Bank Secrecy Act (“BSA”); namely, to implement and maintain an effective anti-money laundering (“AML”) compliance program, and to timely file Suspicious Activity Reports (“SARs”). The judgment sought is based on provisions of the BSA and implementing regulations that authorize a $25,000 per day penalty for willful failures to maintain AML compliance programs and file SARs.
The case against Haider follows a series of statements from FinCEN Director Jennifer Shasky Calvery and other regulators stressing individual accountability. The use of civil enforcement tools to hold compliance officers and senior management individually liable for BSA deficiencies is a noted enforcement trend that will likely continue in 2015.