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Riggs Bank + CIA Allegedly "At Least" to BOP

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Riggs Nears Guilty Plea Over Money Laundering

WASHINGTON -- Riggs Bank N.A. (RIGS), whose international dealings helped

trigger a federal crackdown on money laundering by U.S. financial institutions,

is expected to plead guilty to a criminal charge arising from its services for

foreign embassies and wealthy clients, including former Chilean dictator

Augusto Pinochet, Wednesday's Wall Street Journal reported.

The Riggs board has been presented with a plea agreement by prosecutors in

which the bank would admit to one count of violating the Bank Secrecy Act by

failing to file reports to regulators on suspicious transfers and withdrawals

by clients, people close to the case said. Directors are expected to accept the

plea and the bank would pay a fine of between $16 million and $18 million. The

deal could be announced as soon as tomorrow, these people said.

As details of the bank's problems emerged, Riggs, a storied Washington

institution whose headquarters across the street from the U.S. Treasury were

once pictured on $10 bills, became emblematic of lax compliance with

money-laundering laws and weak board oversight.

The case sparked a campaign by prosecutors and bank regulators to enforce

money-laundering provisions of the 2001 Patriot Act that are designed to

prevent terrorists and other criminals from infiltrating the U.S. financial

system. Federal prosecutors and regulators have been aggressively investigating

other banks since the Riggs scandal emerged last year, probing more than a

half-dozen major banks for money-laundering violations.

Most recently, Banco de Chile disclosed that the Office of the Comptroller of

the Currency and the Federal Reserve Bank of Atlanta are conducting targeted

examinations involving two of the company's U.S. branches. The OCC is looking

into Banco de Chile's New York branch to determine the bank's compliance with

the U.S. Bank Secrecy Act and anti-money-laundering requirements regarding

certain accounts, the company said in a regulatory filing.

For decades, Riggs bank cultivated close ties to the government, including

custody of accounts for the Central Intelligence Agency, The Wall Street

Journal reported last month.

The CIA-Riggs relationship allegedly stretches back at least to the Cuban Bay

of Pigs affair in the 1960s, according to intelligence historian Thomas Powers.

After its alleged international money-laundering violations surfaced last year,

the bank's directors moved to close its embassy-banking division, and its

holding company, Riggs National Corp., agreed to a buyout by PNC Financial

Corp. (PNC) of Pittsburgh for $321 million in cash and 7.5 million shares of

PNC stock, valuing the deal at $779 million at the time it was announced.

The deal has been in doubt with the criminal probe under way, however. An

agreement with the Justice Department could clear the way for it to proceed,

but could also give PNC a right to renegotiate the price or terms, under a

"material adverse change" clause in the sale contract.

A spokesman for Riggs declined to comment.

Wall Street Journal Staff Reporters John R. Wilke and Mitchell Pacelle

contributed to this report.

(END) Dow Jones Newswires


Don Roberdeau

U.S.S. John F. Kennedy, CV-67, "Big John" Plank Walker

Sooner, or later, the Truth emerges Clearly





T ogether

E veryone

A chieves

M ore



"Here again we appear to be confronted with one more indication of

consciousness of guilt, which we must add to other indications of Secret

Service complicity in the death of JFK."

-from the ARRB's final report (1998)

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