    [Senate Prints 107-22]
    [From the U.S. Government Publishing Office]

    107th Congress                                                  S. Prt.
     1st Session                COMMITTEE PRINT                      107-22
    _______________________________________________________________________

                       SUPPLEMENT TO THE FEBRUARY 5, 2001
                        REPORT ON CORRESPONDENT BANKING:
                         A GATEWAY FOR MONEY LAUNDERING

                                   __________

                                  R E P O R T

                                prepared by the

                                 MINORITY STAFF

                                     of the

                    PERMANENT SUBCOMMITTEE ON INVESTIGATIONS

                                     of the

             COMMITTEE ON GOVERNMENTAL AFFAIRS UNITED STATES SENATE

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                            CASE HISTORIES 8, 9 & 10

                               February 28, 2001

                        U.S. GOVERNMENT PRINTING OFFICE
    71-167                      WASHINGTON : 2001

                       COMMITTEE ON GOVERNMENTAL AFFAIRS

                       FRED THOMPSON, Tennessee, Chairman
    TED STEVENS, Alaska                  JOSEPH I. LIEBERMAN, Connecticut
    SUSAN M. COLLINS, Maine              CARL LEVIN, Michigan
    GEORGE V. VOINOVICH, Ohio            DANIEL K. AKAKA, Hawaii
    PETE V. DOMENICI, New Mexico         RICHARD J. DURBIN, Illinois
    THAD COCHRAN, Mississippi            ROBERT G. TORRICELLI, New Jersey
    JUDD GREGG, New Hampshire            MAX CLELAND, Georgia
    ROBERT F. BENNETT, Utah              THOMAS R. CARPER, Delaware
                                         JEAN CARNAHAN, Missouri
                 Hannah S. Sistare, Staff Director and Counsel
         Joyce A. Rechtschaffen, Democratic Staff Director and Counsel
                         Darla D. Cassell, Chief Clerk

                                     ------

                    PERMANENT SUBCOMMITTEE ON INVESTIGATIONS

                       SUSAN M. COLLINS, Maine, Chairman
    TED STEVENS, Alaska                  CARL LEVIN, Michigan
    GEORGE V. VOINOVICH, Ohio            DANIEL K. AKAKA, Hawaii
    PETE V. DOMENICI, New Mexico         RICHARD J. DURBIN, Illinois
    THAD COCHRAN, Mississippi            MAX CLELAND, Georgia
             Christopher A. Ford, Chief Counsel and Staff Director
          Linda J. Gustitus, Minority Chief Counsel and Staff Director
                  Elise J. Bean, Minority Deputy Chief Counsel
            Robert L. Roach, Minority Counsel and Chief Investigator
                         Mary D. Robertson, Chief Clerk

                                C O N T E N T S

                                     ------
                                                                       Page

    VIII. Ten Case Histories Continued From February 5, 2001 Report

    No. 8: Swiss American Bank and Swiss American National Bank......     1
        A. THE FACTS.................................................     1
           (1) Ownership and Management..............................     1
           (2) Financial Information and Primary Activities..........     3
           (3) Correspondents........................................     4
           (4) Operations and Anti-Money Laundering Controls.........     4
           (5) Regulatory Oversight..................................     5
           (6) Money Laundering and Fraud Involving SAB/SANB.........     5
              (a) Controversial Leadership...........................     5
              (b) The Fitzgerald Case--Drugs and Terrorist Money.....     8
              (c) The Gherman Fraud..................................    13
              (d) The DeBella Fraud..................................    15
              (e) The Fortuna Alliance Fraud.........................    20
              (f) Other Frauds/Questionable Accounts.................    23
              (g) Internet Gambling/Sports Betting...................    24
           (7) Correspondent Accounts at U.S. Banks..................    25
              (a) Bank of New York...................................    25
              (b) Bank of America....................................    36
              (c) Chase Manhattan Bank...............................    44
        B. THE ISSUES................................................    60

    No. 9 and No. 10: M.A. Bank and Federal Bank.....................    63
        A. THE FACTS.................................................    64
        M.A. Bank
           (1) M.A. Bank Ownership and Management....................    64
           (2) Financial Information and Primary Activities..........    65
           (3) M.A. Bank's Correspondents............................    66
           (4) M.A. Bank's Operations and Anti-Money Laundering
          Controls...................................................    66
           (5) Regulatory Oversight..................................    67
           (6) Money Laundering and Fraud Involving M.A. Bank........    68
              (a) Laundering of Drug Proceeds through M.A. Bank......    68
              (b) Unsound and Illegal Banking Practices..............    72
           (7) Correspondent Account at Citibank.....................    77

        Federal Bank
           (1) Grupo Moneta and Banco Republica......................    89
           (2) Federal Bank Ownership................................    90
           (3) Financial Information and Primary Activities..........    91
           (4) CEI...................................................    93
           (5) Correspondent Account at Citibank.....................    94
           (6) Regulatory Oversight..................................    96
           (7) Central Bank of Argentina Concerns....................    97
           (8) American Exchange Company.............................   104
           (9) Suspicious Activity At Federal Bank...................   105
        B. THE ISSUES................................................   110

        EXHIBITS.....................................................   113

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