WASHINGTON, Oct. 7, 2015 /PRNewswire/ -- Majority shareholders and directors of Banca Privada d'Andorra (BPA), Ramon and Higini Cierco (Ciercos), are suing the U.S. Treasury and its Financial Crimes Enforcement Network (FinCEN) in the United States District Court for the District of Columbia after FinCEN issued a Notice of Finding that labeled BPA as a "primary money-laundering concern" and a Notice of Proposed Rulemaking barring BPA from the US banking market. That Notice also encouraged and implemented coordinated action with Spanish, Andorran and Panamanian regulators to shut down the bank without any notice or hearing, which happened the same day as part of a coordinated action. The Ciercos are seeking an Order that rescinds the Notices issued by FinCEN.
The Ciercos' suit makes clear that FinCEN had no legitimate basis for its Notices under Section 311 of the Patriot Act. The FinCEN Notices were fatally defective, the Complaint alleges, as they failed to provide the informational basis for its actions or the reasons for choosing the most severe measure. Indeed, subsequent events have made clear that FinCEN did not have a basis to act against BPA, but in fact was frustrated with the Government of Andorra's unresponsiveness in making systemwide changes to its AML rules, especially its cash transaction reporting. A US Embassy official admitted that FinCEN "used the hammer" on BPA-not because of BPA's actions-- because of FinCEN's frustration with Andorra's unwillingness to cooperate. The US government denied the statement was made, but in fact it was caught on videotape and uploaded to YouTube. A link is embedded in the complaint.
Since FinCEN took action to close the bank, the shareholders have repeatedly contacted FinCEN requesting the factual bases for its actions, including why it chose to implement its most extreme penalty. According to the Complaint, the shareholders have requested a chance to review all of FinCEN's evidence and make their case as to why BPA should not be shut down. FinCEN has characteristically refused to explain its actions or why it failed to consider the impact on the extensive and well-regarded business operations of BPA or the massive loss of jobs, as it was required to do by statute. FinCEN's decision to implement the fifth special measure destroyed a bank worth more than a half billion dollars and cost hundreds of jobs. The incidents of money laundering cited as the pretext for closing the bank were in fact reported more than a year before by BPA to its regulators. FinCEN has since delayed the process to avoid accountability and prevent meaningful judicial review.
Since FinCEN's notice, the international auditing firm PricewaterhouseCoopers (PwC) was appointed by the Andorran authorities to investigate BPA. The Andorran government has spent tens of millions of dollars to have PwC review all of the approximately 25,000 accounts at BPA. It has been reported that, despite pressure by the Andorran government, PwC has said they have found no systemic issues that would warrant FinCEN's actions.
Given the unwillingness of regulators to engage in constructive dialogue, Ramon and Higini Cierco have been forced to turn to the Courts, seeking an Order that FinCEN's notice and implementation of the fifth special measure are unlawful and must be rescinded. This would enable the Ciercos to resume control of the banks' remaining assets to determine a long-term, fair and transparent solution that treats their customers, shareholders, and employees fairly regarding the future of their bank.
Eric Lewis, lead global coordinator on behalf of the Ciercos said, "This complaint seeks to remedy the lack of due process and transparency our clients faced, despite every attempt to cooperate and to provide FinCEN with evidence that its actions were wholly unjustified actions. Overnight, without any notice, public evidentiary record, or recourse, BPA was issued a death sentence as a result of FinCEN's actions. Absolute power exercised in the hands of one agency without accountability only leads to bureaucratic abuse and cover-up, which is exactly what has happened here. The Ciercos are determined to clear their good name for the honor of their employees, shareholders, customers, and this honest and respected family."
The Cierco complaint can be found at the following link: https://www.scribd.com/doc/283963834/Cierco-Complaint-and-Attachments
