Major US Bank Fined for Drug Money Laundering, MD Waives Drug Test Fees for Parolees, More... (10/11/24)

Hawaii wants to see what a legal marijuana market in the state would look like, the death toll continues to rise from Sinaloa Cartel faction fights, and more.

TD Bank got caught doing money laundering for drug traffickers, among others. They paid a huge fine, but nobody went to jail. (Pixabay)

Marijuana Policy

Hawaii Officials Seek Expert Analysis on Potential Marijuana Market Demand as Lawmakers Continue to Consider Legalization. The state Office of Medical Cannabis Control and Regulation (OMCCR) is seeking to assess the state of the state's medical marijuana program and estimate demand for recreational marijuana if the state moves forward with legalization.

The OMCCR has issued a request for proposals (RFP) seeking input from existing vendors to "conduct an independent assessment of the Medical Cannabis Dispensary Licensing framework and an analysis of the demand for cannabis, both for medical cannabis and adult-use, in Hawaii should the state legalize adult-use of cannabis."

While lawmakers have fought for years to pass marijuana legalization, it has yet to happen. The Senate approved one such bill in March only to see it die in the House.

"In recent years, there has been growing interest in the legalization of cannabis for adult use," the RFP says. "OMCCR requires a market demand study to predict total demand (including demand from Hawaii residents and tourists) for cannabis and cannabinoid product from all sources, including medical cannabis, adult-use cannabis, home cultivation, hemp-derived cannabinoid products, and the illicit market," the notice says.

"The market demand study should also assess the economic impact of an adult-use cannabis program, as well as its effects on the medical cannabis program, public health and safety, and environmental health and safety. The assessment and study will guide the development of regulatory frameworks, including licensing, production quotas, and taxation levels. They will inform the planning of policies, education campaigns, and measures to protect public health and safety and environmental health and safety."

Interested parties have until November 1 to reply to the RFP, and the selected party will have until March 15, 2025, to file a final report. There is a $94,100 paycheck for whoever gets the gig.

Law Enforcement

Country's 10th Largest Bank Pleads Guilty to Bank Secrecy Act and Money Laundering Conspiracy Violations in $1.8B Resolution. The 10th largest bank in the United States, TD Bank, and its parent company TD Bank US Holding Company (TDBUSH) pleaded guilty Thursday and agreed to pay over $1.8 billion in penalties to resolve the US Attorney's Office for the District of New Jersey and the Justice Department's investigation into violations of the Bank Secrecy Act (BSA) and money laundering.

The bank pleaded guilty in a New Jersey federal district court to conspiring to fail to maintain an anti-money laundering program that complies with the BSA, failing to file accurate Currency Transaction Reports (CTRs), and money laundering.

"TD Bank prioritized growth and convenience over following its legal obligations. As a result of staggering and pervasive failures in oversight, it willfully failed to monitor trillions of dollars of transactions -- including those involving ACH transactions, checks, high-risk countries, and peer-to-peer transactions -- which allowed hundreds of millions of dollars from money laundering networks to flow through the bank, including for international drug traffickers. The bank was aware of these risks and failed to take steps to protect against them, including for two networks prosecuted in New Jersey and elsewhere -- one that dumped piles of cash on the bank's counters and another that allegedly withdrew amounts from ATMs 40 to 50 times higher than the daily limit for personal accounts," said US Attorney for the District of New Jersey Phillip Sellinger.

"By making its services convenient for criminals, TD Bank became one," said Attorney General Merrick B. Garland. "Today, TD Bank also became the largest bank in US history to plead guilty to Bank Secrecy Act program failures, and the first US bank in history to plead guilty to conspiracy to commit money laundering. TD Bank chose profits over compliance with the law -- a decision that is now costing the bank billions of dollars in penalties. Let me be clear: our investigation continues, and no individual involved in TD Bank's illegal conduct is off limits."

As part of the plea agreement, TD Bank has agreed to forfeit $452,432,302.00 and pay a criminal fine of $1,434,513,478.40, for a total financial penalty of $1,886,945,780.40. TD Bank has also agreed to retain an independent compliance monitor for three years and to remediate and enhance its AML compliance program.

Attorney General Garland threatened possible criminal prosecution, but that has not happened yet. That is not the case for people accused of federal drug offenses, who are routinely prosecuted and imprisoned -- not just fined -- for their crimes.

Maryland Cancels Supervision, Drug-Testing Debt for Everyone on Parole. Gov. Wes Moore (D) last week announced that the state has canceled more than $13 million in debt that parolees owed for unpaid supervision or drug testing fees. The move came just days after he signed into law a bill, House Bill 531, that waives those fees going forward.

The debt cancellation will directly benefit 6,715 people. It does not apply to other parole-related debts nor to probation-related debts. Prior to these moves, parolees faced $40 to $50 each month in supervision fees and $100 for each random drug and alcohol test.

"Even the most motivated people coming home from prison have trouble getting a job, whether because of the scarlet letter of their criminal record, struggles with substance abuse or just managing that difficult transition to life back in the real world," said Attorney General Anthony G. Brown (D. "By waiving supervision fees, which disproportionately impact low-income communities and people of color, Governor Moore and the General Assembly are easing financial burdens on Marylanders trying to get their lives back on track. These changes will also lower the risk of recidivism and help advance our shared goal of eliminating mass incarceration," he added.

International

Mexico Cartel Infighting Continues, Sinaloa Governor Now Under Investigation. The death toll from factional fighting for control of the Sinaloa Cartel has risen to more than 150 in the weeks since cartel cofounder Ismael "El Mayo" Zambada was kidnapped and delivered to US authorities by one of the sons of imprisoned cartel co-founder Joaquin "El Chapo" Guzman, who also turned himself in. The casualties include not only cartel gunmen but also civilians and members of the Mexican armed forces.

The fight for control between "Los Chapitos" and "La Mayiza" has led to increased federal scrutiny of ties between the cartel and state and local authorities. Last week, the army confiscated the weapons of some members of the local police in Culiacan, the state capital, suspecting they were working with the cartel or carrying unregistered firearms. The city has been wracked by cartel violence for weeks.

Now, Governor Ruben Rocha Moya is being investigated by federal authorities for ties to "Los Chapitos." Zambada has alleged that he was taken to Rocha's residence for a supposed meeting with the governor only to instead be kidnapped and sent across the border into the waiting arms of US officials. And an intelligence report from SEDENA (the Mexican defense ministry) details cooperation between Rocha and "Los Chapitos." The report also says that it is watching Rocha Moya's son, José Rocha Ruiz, for being a possible intermediary between his dad and the Sinaloa Cartel faction.

Rocha is now sweating bullets amidst the cartel war. The SEDENA report said he has become "extremely nervous" and "deeply worried" about his and his family's safety since Zambada was detained, fearing retaliation from his faction members. Rocha is now being guarded 24/7 by members of the National Guard and the Navy, with armored trucks and snipers at the ready.

Rocha has maintained his innocence, saying of the investigation that "nothing would be found" and that the media is exaggerating what is going on in the state. "Sinaloa is not among the most violent states, we are below the national average," he argued.