BANKATLANTIC FORFEITS $10 MILLION TO AVOID MONEY-LAUNDERING CHARGE

MIAMI (AP) -- BankAtlantic Corp. agreed Wednesday to forfeit $10
million to the U.S. government to avoid criminal charges that it
permitted millions of dollars in suspected drug money to be laundered
through its accounts over a nearly seven-year period.

Under an agreement with the U.S. Justice Department filed in federal
court, prosecution against the Fort Lauderdale-based bank will be
deferred for at least 12 months in return for the payment. The
charges will be dismissed altogether if BankAtlantic continues taking
action to remedy the situation.

The investigation, led by the U.S. Drug Enforcement Administration
and federal bank regulators, identified more than $50 million in
suspicious transactions between July 1997 and April 2004, according
to court documents.

DEA agents working undercover as operatives for supposed Colombian
drug lords found that drug money was being wire transferred to a
handful of BankAtlantic accounts overseen by a specific branch
manager. That led to the discovery of other BankAtlantic accounts
being used to launder illicit drug proceeds.

``While a weak link at BankAtlantic let this money in, DEA is
committed to following it where we often see it lead: right to the
pockets of drug kingpins,'' said DEA Administrator Karen P. Tandy.

BankAtlantic admitted in the agreement that it did not identify and
report the suspicious transactions as required by the Bank Secrecy
Act. Court papers say there were numerous ``red flags'' about the
transactions, such as a high volume of both incoming and outgoing
wire transfers to unrelated people and corporations.

Although the unidentified branch manager was to blame for many of the
problems, the investigation also revealed ``serious and systemic''
failures by BankAtlantic to comply with anti-money laundering laws
over several years.

``BankAtlantic willfully and knowingly ignored its obligations under
the Bank Secrecy Act and anti-money laundering requirements for
years,'' said Alice Fisher, assistant U.S. attorney general of the
Justice Department's criminal division.

Officials at BankAtlantic, which operates 79 branch offices in
Florida, did not immediately respond to a telephone call seeking
comment. BankAtlantic is a subsidiary of BankAtlantic Bancorp, a
financial services holding company whose stock was down 2 cents
Wednesday at $15.32 a share.

But the court agreement gives BankAtlantic credit for cooperating
with the investigation, firing employees responsible for the problems
and closing down accounts used for the suspicious transactions. The
bank also created a new anti-money laundering and Bank Secrecy Act
department to beef up compliance and improved audits, training and
software used to detect such transactions.

The investigation is ``a reminder that institutions must remain
vigilant to ensure BSA programs and systems are effectively
implemented to detect and report potential money laundering
activities,'' said John Reich, director of the Office of Thrift
Supervision.