Citibank is one of the largest banks in the United States, and had expanded its branches worldwide since 1990s. Its Mexico branch has more than 65 years history and provides private banking services mainly target on rich clients. Amy Elliott, a head of the Citibank’s Mexico team, was introduced to manage an important account for Raul Salinas. Elliott assisted him to secretly transfer $100 million out of Mexico without obeying Citibank’s know your Customer policy. One year later, Mexico authorities had arrested Raul Salinas on charges of murder and laundering money. In order to investigate Salinas, the Swiss agents encouraged Elliott to set a trap for the Salinas’s wife. Now, Elliott feels puzzled whether to cooperate with Swiss authorities. If she cooperates, she could probably avoid server legal punishments, but she has obligation to conceal her clients’ identity. The following paper will examine the alternatives and consequences of Elliott’s decision. Shareholders
Amy Elliott is in charge of managing Salinas’s account in Citibank. She helped Salinas to transfer substantial funds to foreign accounts in Switzerland and London. However, during the process the transactions, Elliott largely violated Citibank’s “know your customer” policy. Because of the insufficient information known about this client, Elliott may engage in managing a suspensions account involved money laundering.
Raul Salinas, Elliott’s client, requested a confidential way to transfer his huge funds out of Mexico. Salinas explained that releasing his identity might harm his brother’s career. After Mexican authorities arrested him, Swizz federal began to investigate his account. If Elliott cooperates Swiss narcotics agents, this may help Swizz federal to find out some evidence to prove his guilty. Salinas would face the punishment if he were convicted.
Patricia Rios, Salina’s fiancée, helped Raul Salina to transfer $100 million to accounts in Citibank Switzerland under her name. After Salinas was arrested, his wife is the only person who has the authority to get access to the deposit box in the Citibank Switzerland. If the documents in deposit box indicate that Salinas’s guilty, Patricia would directly be the conspirator in this illegal action.
Carlos Salinas and his associates are also affected by Elliott’s decision. As the former president of Mexico, Carlos Salinas’ and his family’s reputation would be collapsed once Raul Salinas was convicted as the money launderer or murder. Furthermore, his enemies would take this advantage to gain political power in Mexico.
Citibank branches including Mexico, New York, Switzerland, and London are affected. Since Salinas’s substantial money was wired from Mexico branch to New York branch. Then, the concentration account transferred the funds to Citibank Switzerland and some deposited at London branch. If these transactions were found out involves illegal actions, those branches were responsible for such unlawful transactions, leading Citibank’s reputation collapse.
Citibank was the first foreign bank in Mexico and provides very personal service. Because it initially established the solid relationship with wealthy clients in Mexico and provides very personal services, Salinas was primarily introduced to use Citibank’s service to meet his confidentiality needs.
Another trigger is the Salinas’s social background. Since Salinas is brother of the Mexican president and also is Citibank’s CEO’s friend, securing the Salinas’s account could not only promote the Mexico Team’s profile, but also possibly Elliott’s career. Both the political power and the potential benefits encourage Elliott to ignore the KYC policy. Unlike managing regular clients’ accounts, she started to manage Salinas’s accounts without bank references and background checks.
The indirect trigger is the offshore banking secrecy. Most offshore jurisdictions...