Riggs sale would end era for bank to presidents

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But analysts said Riggs failed to adapt to the post-Sept. 11, 2001 era for banks, when special considerations for foreign customers came under heightened scrutiny from regulators concerned with tracing flows of funds that could be used to finance attacks on the United States.

"The good old boy relationships with foreign embassies -- that day had passed. They just weren't quick enough to realize the world had changed," a former banking official said, speaking on condition of anonymity.

A Riggs spokesman could not be reached for comment.

Regulators say the bank improperly handled accounts with several foreign governments, including Saudi Arabia and Equatorial Guinea.

Regulators charged Riggs with failing to report tens of millions of dollars in withdrawals from accounts related to the Saudi Arabian embassy, and additional large sums withdrawn from Equatorial Guinea accounts and deposited into private accounts. Riggs did not admit or deny any wrongdoing.

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http://www.reuters.com/financeNewsArticle.jhtml?type=bondsNews&storyID=5292101