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Global banks moved large sums of allegedly illicit funds over nearly two decades, despite red flags about the origin of the money, BuzzFeed and other outlets reported Sunday, citing confidential documents submitted by the banks to the US government.
The media reports are based on leaked suspicious activity reports filed by banks and other financial firms with the U.S. Department of the Treasury’s Financial Crime Enforcement Network (FinCen). Reuters reported.
The reports, numbering more than 2,100, were obtained by BuzzFeed News and shared with the International Consortium of Investigative Journalists (ICIJ) and other media companies.
The consortium reported that the files contained information on transactions worth more than $ 2 trillion between 1999 and 2017, and the internal compliance departments of financial institutions flagged them as suspicious.
Reuters said the reports are not necessarily proof of wrongdoing, and the ICIJ reported that the documents were a small fraction of the reports filed with FinCEN.
Five global banks appeared most frequently in the documents: HSBC Holdings Plc, JPMorgan Chase & Co, Deutsche Bank AG, Standard Chartered Plc and Bank of New York Mellon Corp.
JPMorgan, the largest US-based bank, moved money for individuals and companies linked to the massive looting of public funds in Malaysia, Venezuela and Ukraine, the leaked documents reveal.
Other money-related crimes include:
- In 2012, London-based HSBC, Europe’s largest bank, signed a deferred prosecution agreement and admitted that it had laundered at least $ 881 million for Latin American drug cartels;
- A bombing in Jerusalem;
- Money linked to an underworld figure named Semion Mogilevich, described as the “Chief of bosses” of Russia’s gangster groups.
Data published in the ICJ website shows that several South African transactions were marked as part of the report.
In a sample of 173 transactions pulled from FinCEN’s archives, ICJ data shows how suspicious transfers flowed to and from South Africa with around $ 482,758 (R7,861,183) received and $ 60,270,011 (R981,430,832) sent.
“US agencies responsible for enforcing money laundering laws rarely prosecute law-breaking megabanks, and the actions taken by authorities have little impact on the flood of looted money flowing through the international financial system,” said the ICJ.
“In some cases, banks continued to move illicit funds even after US officials warned them that they would face criminal prosecution if they did not stop doing business with gangsters, scammers or corrupt regimes.”
Within large banks, systems for detecting illicit cash flows rely on overworked and under-resourced staff, who typically work in back-office offices far from headquarters and have little influence within their organizations.
Documents on file with FinCEN show that compliance workers at major banks often turn to basic Google searches to try to figure out who is behind transfers involving hundreds of millions of dollars.
As a result, they show the secret documents, banks frequently file suspicious activity reports only after a transaction or customer becomes the subject of a negative news article or a government investigation, usually after money is removed. has been.
Read: Push for Postbank to Become South Africa’s First State Bank
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