The ICIJ has just released a new leak named FinCEN files focused on the role of large banks in large-scale money-laundering and the broken financial system that enables this.
The leaked documents include more than 2,100 suspicious activity reports (SARs) written by banks and other financial services and submitted to the U.S. Treasury Department’s Financial Crimes Enforcement Network. The investigation focuses on how well-known banks have profited from transactions moving proceeds of money laundering, corruption, fraud and other suspected crimes. The investigation demonstrates how the continued secrecy and complexity in the financial system as well as weak international standards hamper the fight against illicit financial flows. It also shows how US authorities did not share all relevant information with the authorities in other countries, pointing to the broken international financial system. You can find the Eurodad reaction here and the TJN response here – feel free to use this for inspiration for your own media reactions. Please also share your own reactions with the list!
What period does the investigation focus on? The investigation focuses on SARs concerning transactions from the 1990s to 2017. This is important to note, since many developments in the anti-money laundering frameworks have been agreed since this time, such as the introduction of beneficial ownership registries (RBOs) in the EU as part of the 5th Anti-Money Laundering Directive (AMLD5). You can check how far your country has implemented AMLD5 here, including if your country has only communicated partial – or no – transposition of the directive. The investigation still highlights many of the existing problems with the system, including a high-level of secrecy and complexity in the international financial system and poor cooperation between states.
How much money is involved? Well-known banks cleared over US$2 trillion in transactions that were later flagged as suspicious.
What banks are involved? 85% of the reports included in the leak came from six large banks: Deutsche Bank (982), Bank of New York Mellon (325), Standard Chartered Bank (232), JP Morgan Chase (107), Barclays (104) and HSBC Bank (73). Note that although the banks did not stop the transactions and did profit from them, they also did report them as suspicious to FinCEN.
What are SARs for? By law, banks must file suspicious activity reports (SARs) to the US Treasury Department's Financial Crimes Enforcement Network, or FinCEN, when they spot activity that bears the hallmarks of money laundering or other financial misconduct. SARs by themselves are not evidence of a crime, but they can support investigations and intelligence gathering. The data in the FinCEN files accounts for less than 0.02% of SARs filed between 2011 and 2017, highlighting the scale of the problem.
What countries are mentioned? The ICIJ data portal shows transactions in more than 100 jurisdictions across every continent. You can search transactions by jurisdiction here. A quick analysis shows that the highest volume of transactions originated in Latvia, Russia, US, Switzerland, UAE, UK, Singapore, Cyprus and China respectively, while the highest number landed in Latvia, Russia, Switzerland, US, Hong Kong, Singapore, UAE, Netherlands, China, Cyprus, Estonia and the UK.
- You can find the ICIJ data portal hereand download the data here.
- You can read several of the stories here.
- Overview video from ICIJ here.
- A listof some of the high profile bank clients flagged in the reports, including numerous politically connected people and a number of high-profile individuals who have been charged with tax fraud, corruption or other crimes.
What next? The ICIJ will be releasing more information in the next days. Remember, with these leaks, the first days of media coverage typically focus on the stories that the ICIJ journalists have been working on. CSO quotes and op-eds tend to get picked up in the next phase of analysis and action. We can use this period to influence the public narrative and contact decision makers and relevant authorities with our policy asks.
Your contact point at Eurodad: Olivia Lally
Senior Policy and Advocacy Officer - Tax Justice
Eurodad, European Network on Debt and Development
Tel: +32 2894 4641
Mob: +32 (0) 45 6180 669 (Belgium)
Mob: +353 (0) 85 1430 648 (Ireland/ WhatsApp)
Skype: [email protected]
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