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Federal banking regulators have reprimanded Continental National Bank of Miami for engaging in “unsafe and unsound practices” under anti-money laundering laws. The cease-and-desist order had been expected since last month when the Daily Business Review reported that the Office of the Comptroller of the Currency was close to reaching a settlement of the regulatory charges with directors of the 31-year-old community bank. Continental will be required to revamp its policies and procedures to comply with federal anti-laundering laws under the Bank Secrecy Act. The order requires the bank to establish a comprehensive anti-laundering training program for directors, executives and staffers. Outside auditors also must analyze Continental’s operations and compliance efforts, according to the order. Regulators stressed the need to quickly report suspicious activities and currency transactions of at least $10,000, a longtime banking requirement. Continental did not admit or deny any wrongdoing in accepting the settlement and cease-and-desist order dated June 24 and released late Friday. The order is signed by all nine board members, including chairman Charles Dascal, president Athan “Buster” Castiglia and attorney Ana Maria Escagedo of Aballi Milne Kalil & Escagedo in Miami. Calls to Dascal, who owns the BMW auto dealerships Vista and South Motors, Castiglia and Escagedo were not returned by press time. Castiglia, a former Barnett Bank executive, joined Continental National in 1992 as its top officer with a focus on resolving regulatory problems and putting the bank on a path acceptable to the comptroller. With $211 million in assets and six branches in Miami-Dade County, Continental is a slow-growing bank that targets Miami’s Cuban and Central American immigrant community. The reprimand marks the sixth time in 15 years that Continental has been publicly chastised for violating U.S. banking laws. The bank was last disciplined for undisclosed violations five years ago. The new order tells the bank to look out for suspicious scenarios requiring reports to regulators, such as “frequent or large volume cash deposits or wire transfers or book entry transfers to or from offshore or domestic entities or individuals.” Reports must also be filed when clients conduct transactions “without a business reason or apparent lawful purpose” and when the dealings are “inconsistent with the customer’s business or anticipated account activity.” The order also directs Continental to establish guidelines and procedures for client transactions via pouches and couriers. Continental is required to form a five-member compliance committee that includes three people who are not bank employees or relatives of them. The committee is required to monitor and coordinate the bank’s efforts to comply with the order. A written progress report must go to the board every 30 days, and a comprehensive overview must be sent to regulators each quarter. Continental’s order is not as severe as others levied against six local financial institutions in recent months. Regulators stopped short of fining the bank or requiring the removal of any personnel. Nonetheless, regulators only file public orders in the most serious cases, preferring private agreements to avoid damaging reputations. “When you are at the cease-and-desist level, you are having some real difficult issues,” said international banking attorney John Friedhoff, a partner at Fowler White Burnett in Miami. He does not represent anyone involved in the reprimand but reviewed the order at the request of the Daily Business Review. Enforcement of anti-laundering laws has been a priority for federal banking examiners for a year since a Senate committee criticized regulators for missing suspicious activity at the former Riggs Bank. During the last 15 years, Continental National, its directors and staff have been reprimanded and fined five times for undisclosed violations, according to the comptroller’s Web site. A previous cease-and-desist order expired in March 2002.

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