My article "Money Laundering By Minneapolis Money Managers?" reports that a lawsuit against Patrick Kiley, Trevor Cook and other money managers, had raised the question of whether Associated Bank breached a duty to prevent suspected money laundering. As I mentioned in that article, Associated Bank could have conceivably failed to follow a written Customer Identification Program under 31 CFR 103.121 ¶ (b) (2) (i).
After I wrote "Money Laundering By Minneapolis Money Managers?", two lawsuits were filed against Associated Bank raising these same issues. The gravamen of said lawsuits, was that Associated Bank had supposedly been negligent in allowing suspected securities fraudsters to open and maintain a nominee bank account in the name of Crown Forex LLC. Crown Forex LLC was reportedly a sham business entity and its Associated Bank account was possibly used as a laundering link to wash some of the proceeds of a suspected securities fraud.
The first of these lawsuits was briefly filed in Minneapolis federal court via a November 4, 2009, third amended complaint. That Minneapolis lawsuit against Associated Bank, was soon voluntarily dismissed pursuant to a December 9, 2009 filing and the Court’s December 10, 2009, Order. The second lawsuit against Associated Bank, (Herman Grad vs. Associated Bank NA, Brown County Case #2009-CV-002949), is however, still pending in Wisconsin.
According to the the complaint in the Wisconsin lawsuit depicted below, Associated Bank allegedly ignored the money laundering red flags while opening and / or permitting the Crown Forex LLC account. (See, Complaint at p. 6 ¶¶ 22-23). As described by "Recognizing Hidden Assets, The Red Flags", financial intelligence units, bankruptcy trustees, tax authorities and banks, can use red flags to recognize when assets have been fraudulently concealed.
(Click On The Following Image To Read The Wisconsin Lawsuit / Complaint)
(Edited December 30, 2009)
Copyright 2009 Fred L. Abrams