William Barry Quoted on Risks for Banks Dealing with PPE Transactions in Law360
"Banks Cash In on PPE, But Risks Could Haunt Them"
William Barry discusses the risks faced by banks involved in providing financing for PPE deals. Banks may be able to earn fees on deals to import PPE into the U.S., but these transactions come with risk as regulators have begun to uncover underlying fraud. Barry stated that investigations into fraud start with the alleged fraudsters but will lead to examination of all aspects of the transaction, including whether the bank was involved in the scheme. "Step one will be to look at the actual suspected fraudster. Step two is to get the bank's help in understanding the transaction record. Step three, they'll consider whether the bank's processes were deficient or worse than deficient in connection with the fraudulent conduct." Barry noted that community and mid-size banks face the greatest risk due to the lack of "sophisticated electronic monitoring systems" used by larger banks, but large banks still maintain risk as their automated processes may not recognize PPE transactions as materially significant.