Lynn Johannson, Advisor, Sustainability and ESG
January 4th, 2024
Lynn Johannson, President of E2 Management Corporation and Catalyst for THE Collaboration
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FinCEN Files: All you need to know about the documents leak
BBC | Sep 21, 2020
Leaked documents involving about $2tn of transactions have revealed how some of the world's biggest banks have allowed criminals to move dirty money around the world.
They also show how Russian oligarchs have used banks to avoid sanctions that were supposed to stop them getting their money into the West.
It's the latest in a string of leaks over the past five years that have exposed secret deals, money laundering and financial crime.
What are the FinCEN files?
The FinCEN files are more than 2,500 documents, most of which were files that banks sent to the US authorities between 2000 and 2017. They raise concerns about what their clients might be doing.
See: Fintech & Cybersecurity: Key Risks and Solutions
These documents are some of the international banking system's most closely guarded secrets.
Banks use them to report suspicious behaviour but they are not proof of wrongdoing or crime.
They were leaked to Buzzfeed News and shared with a group that brings together investigative journalists from around the world, which distributed them to 108 news organisations in 88 countries, including the BBC's Panorama programme.
Hundreds of journalists have been sifting through the dense, technical documentation, uncovering some of the activities that banks would prefer the public not to know about.
The FinCEN papers are different because they are not just documents from one or two companies - they come from a number of banks.
They highlight a range of potentially suspicious activity involving companies and individuals and also raise questions about why the banks which had noticed this activity did not always act on their concerns.
See: Remote Working Cybersecurity Checklist
What has been revealed?
- HSBC allowed fraudsters to move millions of dollars of stolen money around the world, even after it learned from US investigators the scheme was a scam.
- JP Morgan allowed a company to move more than $1bn through a London account without knowing who owned it. The bank later discovered the company might be owned by a mobster on the FBI's 10 Most Wanted list.
- Evidence that one of Russian President Vladimir Putin's closest associates used Barclays bank in London to avoid sanctions which were meant to stop him using financial services in the West. Some of the cash was used to buy works of art.
- The husband of a woman who has donated £1.7m to the UK's governing Conservative Party's was secretly funded by a Russian oligarch with close ties to President Putin.
- The UK is called a "higher risk jurisdiction" and compared to Cyprus, by the intelligence division of FinCEN. That's because of the number of UK registered companies that appear in the SARs. Over 3,000 UK companies are named in the FinCEN files - more than any other country.
- Chelsea owner Roman Abramovich once held secret investments in footballers not owned by his club through an offshore company.
- The United Arab Emirates' central bank failed to act on warnings about a local firm which was helping Iran evade sanctions.
- Deutsche Bank moved money launderers' dirty money for organised crime, terrorists and drug traffickers. More details (BuzzFeed News)
- Standard Chartered moved cash for Arab Bank for more than a decade after clients' accounts at the Jordanian bank had been used in funding terrorism.
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