Aug. 12, 2004 – Senior executives at financially troubled Riggs National -- the bank that earlier this year was fined $25 million for a range of money-laundering violations -- are eligible to receive over $7 million in severance pay if they leave the company after its proposed sale to PNC Financial Services Group is completed.
Additionally, the executives could receive another $2.2 million cash from unvested stock options. The bank has been closing down most of its international banking operations as a result of ongoing government investigations into its transactions and ahead of the $779 million buyout by PNC. The closures, the costs of investigations and the fines left Riggs to post a $30 million net loss in the first six months of 2004.
The $25 million fine is primarily in response to Riggs' failure to report suspicious transactions in accounts controlled by Saudi diplomats and officials of Equatorial Guinea. The bank is also under investigation for another money laundering scheme, this time involving Chile. A Senate panel in July found evidence that Riggs, long-known as the favored banking institution of US presidents, helped former Chilean dictator Augusto Pinochet hide millions of dollars after he was arrested for human rights abuses committed during his reign from 1973 to 1990.