[ by Larry Goldfarb ] ING Bank agreed to pay a record penalty of $619 million for allegedly laundering billions through the U.S. banking system on behalf of clients who reside in countries that banks are prohibited from doing business with.  The FATF, or Financial Action Task Force, maintains the list of "Non-Cooperative Countries or Territories."  The U.S. Treasury Department's Office of Foreign Assets Control, or OFAC, enforces the prohibition through sanctions. Nevertheless, the ING Bank, a unit of ING Groep NV, one of the Netherland's largest banks, handled transfers for Cuban and Iranian clients and threatened to fire any employees who didn't conceal the origin of the money.  And so, employees of ING Bank used a system to "strip," or delete, references to Cuba and Iran and, through more than 20,000 separate transactions.  They successfully moved more than $2 billion through the U.S. financial system.  ING Bank the 4th major bank to settle with New York and U.S. authorities in recent years over such activities. Previous Cases. In 2009, Swiss-based Credit Suisse Group AG agreed to pay $536 million and the U.K.'s Lloyds Banking Group PLC agreed to pay $350 million to settle similar allegations with New York and U.S. authorities.  In 2010, the U.K.'s Barclays PLC agreed to settle allegations by paying a $298 million fine.  ING's fine is the largest ever for these types of violations. Foreign banks operating in the US ... often mandate certain aspects of their banking operations to be run out of their home country.  These units, despite pleas from management in their U.S.-based banking units, do not feel compelled to do what the banks consider carrying out U.S. foreign policy.  Thus, at certain times, these units may try to countermand these prohibitions by surreptitiously performing these activities, which are not illegal in the home country. Global management of the particular units often encourage these illegal activities because they do not feel beholden to US laws.  In fact, it is not unusual for the money transfer departments with a branch in the U.S. to run entirely out of the home country with no U.S. management.  In the early 2000s, UBS moved the management of the money transfer unit from Switzerland to the US and made the head sit on the U.S. Governance committee, in response to a number of hefty fines. ING profited by courting business from sanctioned entities like Iran and Cuba, according to court documents filed on Tuesday.  Its clients in Cuba included a range of people, from individuals who wanted to cash U.S. travelers checks to government ministries.  It also engaged in transactions with Iran's central bank and state-owned National Iranian Oil Co. Cyrus Vance Jr., the Manhattan district attorney, ... who is investigating other banks for possible similar violations, said in an interview Tuesday that "stripping" cases are about more than monetary damages.  "They ensure that rogue regimes and human-rights abusers are isolated and feel economic pressure from sanctions," he said. Mr. Vance and the Justice Department noted that ING (referring to U.S. management) devoted significant resources to conducting an internal probe starting in 2006 and cooperating with the government.  U.S. authorities said they would drop charges against the bank after 18 months, provided ING agrees to certain overhauls and cooperates with the government. For more information, see [WSJ, 6/12/12].