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Published on January 23, 2025
Dubai-Based Wall Street Exchange Pays Over $9.2 Million to Settle U.S. Bank Fraud AllegationsSource: Google Street View

The Dubai-based Wall Street Exchange has agreed to fork over a hefty sum north of $9.2 million to resolve a sticky situation involving bank fraud allegations, per announcements from John J. Durham, U.S. Attorney for the Eastern District of New York, and IRS-Criminal Investigation's New York Special Agent in Charge Harry T. Chavis, Jr. This resolution comes in the form of an NPA (non-prosecution agreement) struck on Sunday, with the U.S. Attorney's Office and the Department of Justice's Money Laundering and Asset Recovery Section.

As per the agreement details, Wall Street Exchange will cough up a criminal monetary fine of $3,920,000, alongside forfeiture in the tune of $5,326,648—a slap on the wrist that comes after having misled a U.S. financial institution about its U.K. subsidiary's anti-money laundering chops. The Office's commitment to protecting the integrity of U.S. banks is clear, with U.S. Attorney Durham stating, "My Office is committed to holding foreign actors accountable for abusing our financial system," according to a press release.

Wall Street Exchange, headquartered in Dubai, and its subsidiary, Wall Street Forex London Limited, have not been playing by the rules, especially between 2012 and 2017, when they essentially kept Bank A (which held their U.S. dollar correspondent bank accounts) in the dark about ongoing investigations into their money laundering controls across the pond. The U.S. Attorney's Office and MLARS didn't turn a blind eye, and now WSE will have to play ball by providing future cooperation and information as spelled out by the NPA. As Special Agent in Charge Chavis put it, "WSE's failure to inform the US bank of an open investigation in the UK left the bank vulnerable to regulatory scrutiny," as obtained by a statement.

It's clear that corners were cut and the truth stretched thin as Forex and WSE spun tales to Bank A about the state of their internal audits and regulatory heat they were facing—at one point labeling the UK exit as a "business decision" rather than admitting to HMRC bringing the hammer down. Caught in the act, Wall Street Exchange must now settle the tab, and with this deal, it's a signal that the Feds are dead serious about keeping the financial markets honest. Cooperation with the investigation and reforms to prevent future misdemeanors got WSE off the hook for criminal prosecution this round, but it's clear that the scales of justice don't tip easily when it comes to bank fraud, as the Assistant U.S. Attorneys and MLARS' Bank Integrity Unit have showcase in this case.