Rabobank NA Sentenced for Conspiring to Impair, Impede, and Obstruct Its Primary Regulator

Rabobank National Association (Rabobank), a Roseville, California subsidiary of the Netherlands-based Coöperatieve Rabobank U.A., was sentenced today by U.S. District Judge Jeffrey T. Miller of the Southern District of California for impairing, impeding and obstructing its primary regulator, the Department of the Treasury’s Office of the Comptroller of the Currency (the OCC), by concealing deficiencies in its anti-money laundering (AML) program and for obstructing the OCC’s examination of Rabobank.  Rabobank was sentenced to a two-year term of probation, and ordered to pay the statutory maximum fine of $500,000.  Additionally, as part of its guilty plea, Rabobank forfeited $368,701,259 to the United States as a result of allowing illicit funds to be processed through the bank.

Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Adam L. Braverman for the Southern District of California, Special Agent in Charge Dave Shaw of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in San Diego and Special Agent in Charge R. Damon Rowe of Internal Revenue Service Criminal Investigation (IRS-CI) Los Angeles Field Office made the announcement.

“Rabobank’s branches on the Mexican border processed hundreds of millions of dollars in suspicious transactions likely tied to international narcotics trafficking, organized crime, and money laundering,” said Acting Assistant Attorney General Cronan.  “Instead of filing reports that would have alerted law enforcement to the suspicious activity, as required by law, the bank looked the other way and then compounded its misconduct by conspiring to cover-up its failures and deceiving its regulator.  Today’s sentence and the related forfeiture demonstrate that the Department of Justice will use all the tools at our disposal to combat drug trafficking and transnational crime—including prosecuting financial institutions that turn a blind eye to illicit proceeds moving through their customers’ accounts.”  read more »

GlaxoSmithKline faces fresh whistleblower allegations

GlaxoSmithKline is facing fresh criticism over the way it treats whistleblowers after a lawsuit was filed by a former senior technical lead claiming he was harassed and wrongfully dismissed after repeatedly warning over issues with the pharmaceutical giant's computer fleet.

The case, filed in the US, piles more pressure on Glaxo to review its policy for whistleblowers, after a series of high-profile claims against the company over the last decade.

These have led to a $96m (£71m) payout to one former employee who exposed contamination at a factory in Puerto Rico, a wider-ranging corruption probe in China and a $3bn settlement in the US over mispromoted drugs.

In the latest lawsuit, Thomas Reilly, who worked at Glaxo for 16 years as a senior service management technical lead, claims he alerted both his direct superiors over issues with IT systems, specifically the "instability and non-compliance of the production computer system" that supported drug manufacturing, but his concerns were ignored.

Mr Reilly alleged the problems were "being covered up and disregarded", and that he was subject to "hostility, discrimination and retaliation" after having pointed out the issues. read more »

Ex-Barclays trader tells court being a bank VP is like working at McDonald's

A former Barclays (BARC.L) trader on trial in London on charges he conspired to rig Euribor interest rates said on Thursday he was no more senior at the bank than people who served burgers at fast-food chain McDonald’s.

Prosecutor James Waddington told the jury at Southwark Crown Court that Italian-born Carlo Palombo was earning “just shy” of 1.5 million pounds by 2008 and had been promoted to vice president by 2009.

But Palombo, the first of five traders charged in the high-profile case to give evidence and face cross-examination, said his promotions had been “very standard” in the industry.

“VP means junior,” he said, comparing the title to being “like the guy who serves you at McDonald’s”.

Four former Barclays bankers and one Deutsche Bank (DBKGn.DE) employee each face one charge of conspiracy to defraud by dishonestly manipulating Brussels-based Euribor rates between 2005 and 2009.

Philippe Moryoussef, a former senior trader who is being tried in absentia, Palombo, Briton Colin Bermingham, Sisse Bohart, a Dane, and Frankfurt-based Deutsche employee Achim Kraemer deny the charge.

The group, aged between 39 and 61, is the first to be charged over alleged Euribor misconduct in a global investigation into benchmark rate rigging, which British investigators first started examining in 2012. read more »