| ST. LOUIS
ST. LOUIS May 2 A former compliance chief at
MoneyGram International has been suspended from his current
lobbying job for a credit-union trade group as he prepares to
defend against a potential $5 million fine over his role in the
money-transfer giant's anti-money laundering failures.
The suspension of Thomas Haider was confirmed on Thursday by
his employer, the Cornerstone Credit Union League. It is the
latest development in a case that raised the personal liability
stakes for senior executives on the commercial front lines of an
international crackdown on illicit financial transactions.
Although compliance officers in the past couple years have
come to realize that they could face penalties, the fines levied
on them have typically been in the tens of thousands of dollars.
A fine in the millions of dollars would be unprecedented
Haider left MoneyGram, the world's second largest
money-transfer company, in 2008 and for the past three years has
been a lobbyist for Cornerstone.
Some months ago Haider received a letter from the U.S.
Treasury Department's Financial Crimes Enforcement Network
(FinCEN) advising that he might soon be penalized up to $5
million in relation to his role at Moneygram. The letter offered
him a hearing to contest the action.
Cornerstone suspended Haider eight days after the potential
fine was reported by Thomson Reuters' Compliance Complete.
"Mr. Haider, on Friday, April 25, was asked to take an
indefinite leave of absence from his position with the
Cornerstone Credit Union League in order to focus his attention
on his personal situation related to FinCEN," Cornerstone
spokesman Jon Gorman said in an emailed statement.
Neither Haider nor his lawyer, Ian Comisky, a partner with
Blank Rome in Philadelphia, responded to requests for comment.
The specific allegations that FinCEN plans to levy against
Haider are not known. The agency earlier declined to comment.
RISK CALCULUS CHANGES
The focus on Haider comes as the United States and other
countries crack down on money-laundering in a larger effort to
fight organized crime and enforce international economic
U.S. lawmakers have been pressuring regulators and
enforcement authorities to hold accountable individuals at
financial services firms with systemic anti-laundering failures.
In the wake of HSBC's $1.9 billion settlement in December
2012 over serious anti-laundering and sanctions compliance
failures, personal fines for compliance officer in the tens of
thousands of dollars have become increasingly common.
However, the personal risk calculus for compliance officers,
especially those in top leadership roles, changed dramatically
with the disclosure that Haider faces a multi-million dollar
"It means that the only viable world for well-intentioned
compliance professionals will be consulting, where you hold
none of the risk personally," a top compliance officer at one of
the largest banks operating in the United States said.
The executive said that these are "scary" times, and that if
FinCEN issues a massive penalty to Haider, it "better be backed
by a fact set chock full of willful, borderline-illegal acts."
The executive and other senior compliance executives spoke
on condition of anonymity, citing concern over retribution. All
said they will wait and see how the case is resolved before
making career moves.
FAILURES AT MONEYGRAM
MoneyGram agreed in November 2012 to forfeit $100 million as
part of a deferred prosecution agreement with the Justice
Department. MoneyGram admitted it aided in wire fraud and failed
to maintain an effective anti-money laundering program during
Haider's tenure as compliance chief, according to court
MoneyGram also admitted failures to maintain an effective
anti-money laundering program, in part because of its failures
to report the agents involved in the fraud.
At the time of the MoneyGram settlement, FinCEN, which has
authority to issue civil penalties, declined to penalize
MoneyGram or its employees.
FinCEN's director, Jennifer Shasky Calvery, has taken a more
aggressive enforcement stance since she became the head of the
bureau in September 2012.
(Reporting by Brett Wolf of the Compliance Complete service of
Thomson Reuters Accelus accelus.thomsonreuters.com;
Editing by Randall Mikkelsen and Leslie Adler)