World’s Biggest Banks “Let Criminals Launder Dirty Money”, Leaked Documents Says | Economic news


Some of the world’s biggest banks have been accused of allowing criminals to launder dirty money, according to an investigation based on leaked internal reports.

More than 2,100 Suspicious Activity Reports (SARs) covering over $ 2 trillion (£ 1.5 billion) in transactions have been disclosed to BuzzFeed News and shared with the International Consortium of Investigative Journalists (ICIJ).

These reports, and over 17,600 other documents obtained by the ICIJ, would show how senior bank officials allowed fraudsters to transfer money from one account to another knowing the funds were being generated or used at for criminal purposes.

Covering transactions between 1999 and 2017, the SARs were disclosed by the US Financial Crimes Investigation Network (FinCEN), an agency that is part of the US Treasury and charged with combating money laundering.

Two weeks ago, FinCEN warned that media organizations were preparing to publish an article on documents that had been obtained illegally, before announcing last week that it was seeking public comment on how to improve. the anti-money laundering system in the United States.

According to the ICIJ, the $ 2 trillion in suspicious transactions identified in the documents represents less than 0.02% of the more than 12 million SARs that financial institutions filed with FinCEN between 2011 and 2017.

In the main conclusions of his report, the ICIJ alleged: “Big banks transfer money for people they cannot identify and in many cases only report suspicious transactions years after the fact.

“Government fines and threats of criminal prosecution against banks have not stopped a wave of illicit payments,” the organization added, raising questions about the suppression of money laundering.

HSBC, Standard Chartered, Deutsche Bank and Bank of New York Mellon were the other financial firms named in the survey

BuzzFeed News described the documents as revealing “how the western banking giants are shifting billions of dollars in suspicious transactions, enriching themselves and their shareholders while making the job of terrorists, kleptocrats and drug pioneers easier.” .

Among the criminal organizations cited in the reports are the Al Zarooni Stock Exchange, which was sanctioned by the US Treasury in 2015 for laundering money for the Taliban.

The SARs would also show how the Russian and Ukrainian oligarchs avoid sanctions to transfer their money to the West.

Five global banks were named in the survey: JPMorgan Chase, HSBC, Standard Chartered, Deutsche Bank and Bank of New York Mellon.

The ICIJ reported that some of these banks continued to work with “hoodlums, fraudsters or corrupt regimes” even after being warned by US officials that they would face criminal charges for doing so.

The DASs were written by internal compliance officers at these banks and are “not necessarily evidence of criminal conduct or other wrongdoing,” the ICIJ reported.

London-based HSBC said it would not comment on the suspicious activity reports, but said the documents referred to historical information prior to its conclusion. deferred prosecution agreement with the United States on his failures to stop Mexican drug cartels from laundering hundreds of millions of dollars.

As part of the deal, HSBC said authorities were satisfied with its anti-money laundering work.

Deutsche Bank said that “a number of historical issues” related to its business “are well known to our regulators”

Standard Chartered, which is also based in the UK, responded to the reports saying: “The reality is that there will always be attempts at money laundering and sanctions loopholes; the responsibility of banks is to put in place effective screening and monitoring programs to protect the global financial system. ”

“We take our responsibility to fight financial crime very seriously and have invested significantly in our compliance programs,” the bank added.

German Deutsche Bank also pointed out that the ICIJ “has reported on a number of historical issues” and said that “those relating to Deutsche Bank are well known to our regulators”.

“The issues have already been investigated and have led to regulatory resolutions in which the bank’s cooperation and correction has been publicly acknowledged,” Deutsche Bank added.

Bank of New York Mellon said it takes its role “in protecting the integrity of the global financial system seriously, including the filing of suspicious activity reports” and added that it is fully complying with all applicable laws and regulations.

The Bank of New York Mellon Corp. building  at 1 Wall St. is seen in the Financial District of New York on March 11, 2015. REUTERS / Brendan McDermid (US - Tags: BUSINESS)
Bank of New York Mellon said it takes its role “in protecting the integrity of the global financial system seriously”

JPMorgan Chase, who is also based in New York City, said: “We report suspicious activity to the government so law enforcement can tackle financial crime, and spend thousands of people and hundreds of millions of dollars to this important work.

“We have played a leadership role in anti-money laundering reform that will modernize the way government and law enforcement combat money laundering, terrorist financing and other financial crimes. ”

Anti-corruption group Transparency International UK said the leak “shows how UK banks continually fail to tackle suspicious activity and instead offer their services to those with money to hide”.

Its chief executive, Daniel Bruce, said: “These revelations are a damning indictment of the system which is supposed to prevent the UK and other financial centers from becoming havens for dirty money.

“The government should react quickly to this important investigation to show that the UK is serious in the fight against dirty money. ”

Alex Cobham, Managing Director of Tax Justice Network, said: “Swift and robust action is needed, including potential criminal charges, or banks will simply continue to treat prospects of being arrested and fined as a simple matter. commercial cost. “


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