Business Owner Indicted for Failing to Establish an Effective Anti-Money Laundering Program

[nitpicker]

https://www.justice.gov/usao-ndga/pr/business-owner-indicted-failing-establish-effective-anti-money-laundering-program

Department of Justice
U.S. Attorney’s Office
Northern District of Georgia

FOR IMMEDIATE RELEASE
Friday, May 13, 2016

Business Owner Indicted for Failing to Establish an Effective Anti-Money Laundering Program

ATLANTA – A federal grand jury has indicted Daniel Barrs for willfully failing to follow anti-money laundering requirements under the Bank Secrecy Act as well as conspiracy to commit money laundering for his role in operating a money transmitting business that processed hundreds of millions of dollars’ worth of financial transactions for entities located around the world.
(snip)

According to U.S. Attorney Horn, the indictment, and other information presented in court: Barrs ran a money transmitting business located in the Atlanta area named “Global Transaction Services” (GTS) along with several interrelated entities that transmitted hundreds of millions of dollars’ worth of wires on behalf of customers located around the world, many of whom Barrs knew were not able to obtain access to U.S. banking on their own and were sending or receiving wires from countries that posed money laundering concerns. GTS was marketed as a company that could minimize the costs associated with transactions from entities located in one country and customers in other countries. The Bank Secrecy Act requires money transmitters like GTS to guard against money laundering and illegal activity by developing, implementing, and maintaining an effective anti-money laundering program. Money transmitters that identify certain types of suspicious financial transactions are also typically required to file a “Suspicious Activity Report” (SAR) with the U.S. Department of Treasury, Financial Crimes Enforcement Network.

The indictment alleges that Barrs took steps that ensured that GTS did not have an effective anti-money laundering program even though he knew it was critical that the company maintained one. Barrs hired individuals with no experience with the BSA - such as his teenage grandson - to be the compliance officers, failed to train GTS employees to comply with the BSA, and ignored warnings from independent examiners that GTS’s compliance program was inefficient. He also took various steps to help GTS obtain bank accounts even though domestic financial institutions repeatedly closed GTS accounts.

At one point, Barrs became a controlling owner over a community bank based in Braselton, Georgia, so that GTS could process millions of dollars’ worth of international wires, even though federal regulators opposed his efforts. At one other point, Barrs created a shell consulting company so that GTS could obtain a bank account under false pretenses.

As a result of Barrs’ willful failure to develop, implement, and maintain an effective anti-money laundering program, GTS failed to have sufficient procedures in place to guard against money laundering. Notably, from 2009 through the end of December 2014, GTS failed to file a single SAR.
(snip)

[jmowreader]

1. They know he's laundering money but can't prove it?