Day: September 6, 2021

This coming Saturday is the 20^th anniversary of the attacks upon America on September 11, 2001. Like most Americans, this was the seminal event in the history of our country. I have been thinking a lot about that date and the anniversary; even more so with the fall of Afghanistan and the evacuation from Kabul. I wanted to do something to commemorate this anniversary, so I decided to do a podcast series featuring the personal stories of persons in the compliance field with their thoughts about what the date of 9/11 means to them, how it changed our profession and their thoughts looking back some 20 years later. The lineup for this week is:

• 6 – Gabe Hidalgo
• 7 – Juan Zarate
• 8 – Alex Dill
• 9 – Eric Feldman
• 10 – Scott Moritz
• 11 – John Lee Dumas

My guest today is Gabe Hidalgo, anti-money laundering (AML) compliance expert, who shared how the events of that fateful day changed the course of his career. Hidalgo was working as counsel for insurance companies at the time. He recalled turning on YahooTV as soon as he got to his office on 9/11 and seeing the second plane hit the World Trade Towers. He knew immediately that it was a deliberate attack. “I knew that this was kind of a hallmark moment,” and “that this was not an accident.”
He talked about his frantic attempt to reach his wife, who worked in midtown Manhattan at the time. He told about attempts to drive into Manhattan to pick her up and bring her back to their home in Queens. On that day he saw military roadblocks for the first time on the highways going into Manhattan. His wife was finally able to get a bus off the island and they met up at her bus station. When they finally reunited at home, they were overcome with emotion. He said they cried most of that day and they could hear others crying in the adjacent apartments as well.
One of the most poignant moments was when they heard about the wives who lost their husbands and the children who lost their fathers in the NYC attacks. He and his wife were pregnant with their first child and Hidalgo recalled feeling gutted thinking about the unborn children who would grow up never knowing their fathers.
Having understood that America had been attacked, Hidalgo was determined to join the fight against terrorism. As he related, he needed to “do something more than just shed tears”. He immediately ruled out local law enforcement or the FBI as his wife was adamant that she did not want him carrying a gun or going into harms way. So, Hidalgo started to think about how he could use his skills as an attorney. “I went down the path of looking in private industry, what I can do, and came across anti-money laundering compliance, which I thought was fascinating. And I said to myself, I need a way for me to be able to get into that so that I can start making a difference.”
Hidalgo found a local money service business in Queens that had a global footprint and was looking for a director of legal compliance. He applied and in the interview process told the hiring manager “I don’t have any AML experience, I just need about 30 days to get up to speed.” However, he could immediately handle legal works so “within those 30 days I read everything I could. I looked at every single document that I could in regard to AML. To be honest with you, AML felt like the perfect fit for me, given what I wanted to do was to help as much as I could to help to prevent anything like this happening again in our country.”
The company was about to be examined by the State of New York which focused his learning skills in AML. Hidalgo had to “look at their policy and procedures that they had in place, rewrite a lot of those policies, procedures, and basically put into practice everything I read about AML.” As he wryly noted, “luckily for me, the examination went great.”
We explored how AML compliance has advanced since 9/11. Hidalgo said, “I think if you were to examine the sea change of sweeping changes that have occurred in the last 20 years between what compliance programs looked like back then versus what they are now. It’s a magnitude of hundreds and hundreds of times more difficult for those funds to be moved the way they were moved for the 9/11 plot. These changes have made it much more difficult for terrorist financiers to move funds now.”
Hidalgo, who subsequently worked as a regulator Federal Reserve Bank of New York, added while no program is perfect “I’ve seen these programs in place, even when there were opportunities to enhance what they were doing. A lot of institutions have strengthened and hardened their compliance programs to the point where they can monitor individual transactions as they’re moving across the transactional workflow in the United States. They examine each and every transaction that’s coming across from a correspondent banking perspective, which is probably one of the most high-risk channels for money movement.” He concluded by stating that he believes his colleagues in AML compliance “have done great work over the past 20 years, which has helped law enforcement stop and apprehend would-be terrorists. However, we can’t be complacent”.
I concluded by asking Hidalgo for his reflections looking back at 9/11; some 20 years later. Hidalgo began by noting that “the 20th anniversary is a dark moment”.  9/11 taught us not to be naive, that we’re not as protected as we think we are. He said, “We need to think about not only the people who have lost their lives, but everyone that was impacted – whether they were directly impacted through a family loss, or they were emotionally impacted by what actually occurred.” He is proud of the advancements in AML compliance made to keep everyone safe but concluded, “the work continues.”
Please check out each of the podcasts this week. They will post at 6 AM CT on the Compliance Podcast Network and JDSupra and midnight on Innovation in Compliance, YouTube, iTunes and Spotify.