He's the ABA's Point Man on Money Laundering

Article excerpt

When bankers faced the "death penalty," they put John J. Byrne on the case.

In its first incarnation, the 1990 legislative proposal would have required regulators to revoke a bank's charter, without a hearing, if an institution or its employees were convicted on money laundering charges.

When the dust settled two years later, the industry and Mr. Byrne had won a significant victory. Though the death penalty remained, the law included a number of safeguards and even a long-sought "safe harbor" to shield banks from privacy lawsuits when they report suspicious customers.

|A Lot of Emotion'

"We were afraid back then that we were going to lose," Mr. Bryne said. "There was a lot of emotion surrounding the issue when the bill was introduced."

For nearly a decade, Mr. Byrne has been the American Bankers Association's point man on money laundering and while-collar crime, the lobbyist who deals with lawmakers who write the laws and the regulators who implement them.

In between, he teaches classes on money laundering regulations at two ABA schools each year and speaks at conferences. He even ventured to Eastern Europe a year ago to explain the ins and outs of money laundering to Polish authorities. In addition, he is the trade group's specialist on environmental law.

Getting Along

Living with the money laundering laws will never be easy, Mr. Byrne said. But he suggested a number of things bankers can do to make their lives a little easier.

First, he said, establish a relationship with the local office of the Internal Revenue Service's Criminal Investigations Division, as well as local and state police.

Getting in touch with IRS authorities is a lot easier in small towns with few banks than in big cities. Mr. Bryne said, but the effort is worth it no matter where you're located.

Heeding warnings

"It will help you stay up to date on changes in patterns of illegal activity and you'll get a quicker response" when you need to talk to authorities, he said. And when something goes wrong, "you may get the benefit of the doubt," Mr. Byrne added.

The effort will also help in the event that bank ever faces the loss of its charter because employees engaged in money laundering. Under the provisions of the 1992 death penalty law sponsored by Rep. Frank Annunzio, D-Ill., and Rep. Chalmers P. Wylie, R-Ohio, past cooperation with law enforcement authorities is a factor regulators are required to consider.

Second, bankers should listen carefully when regulators criticize their compliance efforts. …