Wachovia involved in Mexican drug trade laundering

Wachovia Bank, which was absorbed by Wells Fargo & Co. in the subsequent tumult of the 2008 financial crisis, has over the past several years been the subject of a number of criminal and security related investigations relating to fraud, corruption, and questionable business practices.  For example, in 2007 Wachovia was identified in a lawsuit that it had indirectly participated and directly permitted "fraudulent telemarketers to use the bank’s accounts to steal millions of dollars from unsuspecting victims."

Documents from that lawsuit now show that Wachovia had long known about allegations of fraud and that the bank, in fact, solicited business from companies it knew had been accused of telemarketing crimes.  Internal Wachovia e-mail, for example, show that high-ranking employees at the nation’s fourth-largest bank frequently warned colleagues about telemarketing frauds routed through its accounts.

According to the NY Times, Wachovia was making enormous profits from charges associated with the operation of these fraud-engaging accounts.  Linda Pera, a Wachovia executive, wrote in an internal memo that “We are making a ton of money from them."

It therefore comes as no surprise to learn that Wachovia, in its zeal for profits and its internal policies for dispensing with ethical and legal responsibilities, has been engaged in the laundering of Mexican drug money.  The NY Times reports that the bank "will forfeit $110 million, representing the proceeds of illegal narcotics sales that were laundered through the bank" and will pay an additional $50 million fine to the Treasury, as part of a deferred prosecution agreement.

The federal prosecutor in Miami began an investigation about three years ago, focusing on the supposed role of a Wachovia unit in processing illegal money transfers for Mexican exchange houses along the border between the United States and Mexico... Exchange houses in Mexico are part of the global remittance business that allows immigrants in the United States to send money back to relatives in Latin America. Federal officials say drug traffickers have used the money transfer business as a way to move cash around.

When it comes to corporations engaging is despicable and completely unethical behavior a simple slap on the wrist and a nominal fine is the standard.  Perhaps the US government should re-assess its stance, because from my perspective corporate crime, whether it was Enron, Iraqi war profiteers inside the Pentagon, or Wall Street investment houses, the number of crimes continue to escalate and get more grandiose with each passing year.