WASHINGTON—Federal investigators last year traced an alleged money-laundering scheme that ran through the New York branch of Argentina’s largest bank, whose compliance program previously had passed scrutiny from the Federal Reserve.
The Park Avenue branch of Banco de la Nacion Argentina processed more than 20,000 checks between 2005 and 2012 for a client that authorities allege was in the business of obscuring the source of illicit funds, according to a complaint filed in U.S. District Court last year by the U.S. attorney’s office in Montana.
The complaint, which hasn’t been widely reported, comes amid concerns about the Fed’s oversight, including its ability to root out illicit financial activity. The central bank has come under fire for failing to adequately police big Wall Street firms. New York Fed President William Dudley is set to testify before a Senate committee about the issue later this month.