WASHINGTON (CNN) - Riggs Bank, a historic Washington financial institution, pleaded guilty Thursday to a federal charge of failing to report to regulators suspicious transactions worth hundreds of millions of dollars involving foreign diplomats and governments.

Under a deal announced in U.S. District Court in Washington, Riggs will pay a criminal penalty of $16 million but will avoid more serious money laundering charges.

The old-line Washington bank, which built its prestige on catering to world leaders and diplomats, admitted criminal activity in handling accounts associated with former Chilean dictator Augusto Pinochet and officials of the government of Equatorial Guinea. Although the wide-ranging investigation of money laundering and possible terrorist financing included a probe of Riggs accounts of Saudi Arabian diplomats, prosecutors emphasized there were no Saudi-related charges in the plea agreement.

"The guilty plea is in connection with Riggs' repeated and systemic failure accurately to report suspicious monetary transactions associated with bank accounts owned and controlled by Augusto Pinochet of Chile and by the government of Equatorial Guinea," said U.S. Attorney Kenneth Wainstain.

Prosecutors said the probe of foreign and diplomatic accounts at Riggs are completed, and no other government will be implicated.

Riggs for years proclaimed itself "the most important bank in the most important city in the world," and holds a conspicuous location across Pennsylvania Avenue from the White House and Treasury Department.

At a news conference prosecutors said that between 1994 and 2002 Pinochet and his wife maintained multiple bank accounts and deposited more than $10 million.

"Riggs knew or had reason to know that these transactions were suspicious," Wainstain said.

A U.S. Senate investigation last summer found Riggs had "resisted" regulatory oversight "despite red flags involving the source of Mr. Pinochet's wealth" and despite efforts to freeze his assets worldwide.

Meanwhile, the president of Equatorial Guinea and family members established more than 30 accounts at Riggs between 1996 and 2004. "By 2003 the E.G. accounts had become Riggs' largest single relationship, with balances and outstanding loans that totaled nearly $700 million," Wainstain said.

Last April, Riggs Bank paid a civil fine of $25 million to the Treasury Department for lax oversight of suspicious accounts.

Government officials Thursday said the agreement does not end criminal investigation of individual former bank officers.

Pittsburgh-based PNC Bank (Research) last summer announced plans to purchase Riggs Bank if the investigation is successfully concluded, but has the option to back away from the deal.