CHARLESTON, W.Va. – United States Attorney Carol Casto announced the filing of a substantial forfeiture action yesterday involving First National Bank of Williamson for violations of the Bank Secrecy Act.
The Bank Secrecy Act requires financial institutions to maintain programs that detect and report suspicious activity to prevent money laundering. Under this law, banks must report all cash transactions over $10,000 in Currency Transaction Reports. The Bank Secrecy Act also helps prevent structuring, a federal crime that involves the breaking down of cash banking transactions in amounts of $10,000 or less to avoid triggering a bank’s reporting requirements. Whenever structuring is detected, banks are additionally required to file Suspicious Activity Reports.
Between April 2006 and November 2008, Arthur White, Jr., and other individuals, structured $1.36 million in withdrawals of exactly $10,000 cash from First National Bank of Williamson in order to avoid the mandatory reports. In March 2013, Arthur White pleaded guilty in the United States District Court for the Southern District of West Virginia to tax evasion and structuring. White admitted that he cashed checks made payable to his companies that held accounts at First National Bank of Williamson. According to the complaint, First National Bank permitted White to pay cash for cashier’s checks made payable to himself, without first depositing the money into any account.
White and other individuals would receive exactly $10,000 in cash each time they cashed a check. Then they would purchase a new cashier’s check without depositing any of the money, repeating the process until the entire check had been converted to cash. The cash obtained through this structuring was used to pay wages for some of White’s employees. White, and others at his direction, intentionally conducted these transactions to avoid the bank’s reporting requirements and to evade taxes.
This pattern of structuring should have triggered First National Bank’s reporting requirements. As set forth in the complaint, despite First National Bank’s knowledge, it permitted this structuring and failed to report these transactions as required by law. As part of its settlement agreement, First National Bank has agreed not to contest the forfeiture of $1,360,000 to the United States.
The investigation of First National Bank of Williamson was conducted by special agents and law enforcement officers of the Federal Deposit Insurance Corporation Office of the Inspector General, the Federal Bureau of Investigation, and the West Virginia State Police Bureau of Criminal Investigation. Assistant United States Attorneys Eumi Choi and Eric Bacaj handled the forfeiture action. The Money Laundering and Asset Recovery Section of the Department of Justice also provided valuable assistance during the course of the investigation.