KYC, Lender Liability & Daniel Roho Filho

Citigroup, JPMorgan Chase and Wells Fargo thought Daniel Fernandes Roho Filho was the perfect customer. He was rich and had lots of cash to deposit. Often banks turn a blind eye to the business activities of customers, especially when they believe them to be billionaires.

In 2009, the feds began investigating Roho Filho. He was suspected of running a Ponzi scheme, laundering money and drug trafficking. Ultimately, he had to forfeit millions of dollars of cash, a Lamborghini and gold. The federal investigation and forfeitures took place between 2009 and 2013.

In 2014, just months after the feds grabbed millions of assets and business interests, Roho Filho was back at it again. This time he opened 17 banks accounts at Citi, Chase and Wells Fargo. Investors claim that Filho used these accounts as part of a larger scheme to defraud them in yet another investment fraud, this one claiming to repay investors with profits from non-existent gold mines.

The SEC claims Filho raised millions but never had 80 gold mines or a trillion dollars in gold reserves as his company advertised. Where did the money go? Prosecutors say to fund Filho’s lavish life style including a Rolls Royce, two Lamborghinis and two Ferraris.

Filho has been indicted, sued and also charged by the SEC with regulatory violations. If the allegations are true, Filho needs to be removed from active society so he can no longer hurt people. Those actions, however, won’t get back the hard earned money his victims have lost.

The only “deep pockets” in this case are the banks. Are they responsible for investors losses? Yes!

Banks have a duty to perform due diligence on their customers, particularly customers depositing large sums of money. A grade school kid can search Filho’s name and find a trail of broken promises and deceit. So why did these banks open accounts for him?

Why did JPMorgan Chase open an account for Filho? Just weeks before opening accounts for Filho, JPMorgan agreed to pay the Department of Justice $1.7 billion to settle allegations that the bank violated the Bank Secrecy Act and an additional $350 million to the Office of the Comptroller of the Currency. Both agencies were critical of Chase for turning a blind eye to Ponzi schemer Bernie Madoff. It is as if the banks learned nothing from the Madoff prosecution.

Part of the settlement with the Justice Department was a deferred prosecution agreement where JPMorgan promised to impose tighter controls to prevent money laundering.

Evidently, those controls didn’t work.

JPMorgan’s $1.7 billion fine came one year after HSBC was fined $1.9 billion for allowing violent Mexican drug cartels to launder money through its bank. The handwriting was certainly on the wall yet the banks seemingly failed to undertake even the most basic of due diligence.

Bringing a lender liability claim against a bank for facilitating a Ponzi scheme or investment fraud is very difficult. Banks know that and hope that few individuals will be able to afford such a lawsuit. More importantly, there are few lawyers with enough fraud recovery skills to even attempt such a case.

Lender liability cases can be won, however. Particularly when brought as a group, collective or class action. Since 1972, the government has required banks to know their customers (KYC) and put in place anti-money laundering protocols. Banks are also required to report suspicious transactions. We believe that the losses suffered by investors would have been much smaller this time had the banks put people before profits.


The law firms of MahanyLaw and Judge, Lang & Katers prosecute lender liability lawsuits against banks. If you are asking yourself “Can I sue my bank?,” call us. Many cases can be handled on a hybrid or alternative fee basis.

For more information, contact attorney Brian Mahany at [hidden email] or by telephone at (414) 704-6731 (direct). All inquiries kept strictly confidential.

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