Investigations: Boston's Embattled Bank

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"They were very nice people who always treated me like a gentleman," the former bank teller told a reporter last week. The retiree acknowledged cutting some legal corners when dealing with members of a reputed Mob family who made unusually large cash deposits. Said he: "What are you going to do, give them the third degree?" Boston's First National Bank, his former employer, no doubt wishes the teller had done just that. Two congressional panels are probing the banking company (assets: $21 billion), suspecting that it has been involved, perhaps unwittingly, in money laundering, the booming illegal business of covering up the source of income earned from drug trafficking and other crimes.

The federal scrutiny became public last month when the Boston institution paid a record $500,000 fine for making unreported cash shipments of $1.2 billion to and from several foreign banks. Since then, William L. Brown, the bank's chairman, has contended that First National began reporting the shipments, as required by law, as soon as it was warned, in June 1984, about its practices. But last week federal regulators said they had informed First National about its foreign cash transactions in 1982.