In a federal court in Brooklyn, Gyanendra Asre pleaded guilty to failing to maintain an anti-money laundering program in violation of the Bank Secrecy Act, as part of a scheme to bring lucrative and high-risk international financial business to a small, unsophisticated credit union. When sentenced, Asre faces up to 10 years in prison.
In a parallel action, Treasury's Financial Crimes Enforcement Network (FinCEN) assessed a civil money penalty of $100,000 and a five year ban from AML supervisory employment.
Mr Asre's case stems from his role as the BSA Compliance Officer at a single branch, not-for-profit, federal credit union located in New York and managed by a volunteer board. Asre joined NYSEFCU in early 2014 as a credit union member. In November 2014, Asre volunteered to serve as a member of the Credit Union’s Supervisory Committee, established by the Board of Directors. A few months later, NYSEFCU appointed him to the role of BSA Compliance Officer, a volunteer position he held from March 25, 2015, until April 2, 2016.
During this time, the credit union's risk profile increased substantially, including providing services to Asre's unregistered money services businesses. Asre failed to implement adequate AML controls, allowing hundreds of millions of dollars in high-risk and suspicious funds, including substantial bulk cash deposits, to move through the credit union without proper monitoring or reporting to FinCEN.
As a result of these inadequate AML monitoring procedures, over $940 million in suspicious transactions associated with Asre's scheme went unreported in Suspicious Activity Reports (SARs). During Asre's tenure as the BSA Compliance Officer, NYSEFCU did not file a single SAR.
in October 2017, the NCUA liquidated NYSEFCU. Mr. Asre’s actions and the resulting BSA violations “were a major contributing factor to the dissolution of NYSEFCU,” according to the FinCEN settlement. Mr.Asre admitted to willfully violating the BSA, including his failure to register his MSB with FinCEN and his inability to maintain an effective AML program or detect and report suspicious transactions.
Mr. Asre appears in public records from 2015 to 2018 as vice president of correspondent banking for CBW Bank in Weir, Kansas. CBW processed millions of dollars in shipments of U.S. banknotes from at least two Mexican banks, Banco Azteca and Cibanco, into an account at the Federal Reserve Bank of San Francisco’s branch in Los Angeles, according to moneylaundering.com.
Prior to joining CBW, Mr. Asre served in a similar role at HSBC Bank. In December 2012, HSBC agreed to pay $1.9 billion in fines and forfeitures to settle egregious violations of U.S. sanctions and anti-money laundering rules from 2006 to 2009, including failures to vet nearly $700 billion of potentially illicit wire transfers and purchases of U.S. currency by its Mexican affiliate, HSBC Mexico.
Prosecutors said at the time that HSBC Mexico became the “preferred” bank of drug cartels, and accepted hundreds of thousands of dollars in cash deposits from them daily during the three years covered by the settlement. Mr. Asre was not named in the consent orders associated with either institution’s enforcement actions.
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