An American news website, Buzzfeed recently released its investigation reports of FinCEN files. Financial Crimes Enforcement Network (FinCEN) is a US-government body that keeps track of money laundering and similar illegal financial activities. Buzzfeed’s investigation reveals how numerous global banks, financial institutes, companies, and individuals were involved in such illegal financial activities. Let us find out which big names are out and what did they do. Did you know it also included the names of Indian financial institutes?
Crux of the Matter
What Is FinCEN?
Financial Crimes Enforcement Network (FinCEN) works under the US Department of Treasury. Its aim is to collect and analyze financial records to keep a track of money laundering, terrorist financing, etc. They keep track of domestic as well as international doubtful financial transactions in US dollars ($).
What Are FinCEN Files?
FinCEN files are a collection of 2,657 documents. A whistleblower leaked files to Buzzfeed News, which distributed them to 108 news organizations in 88 countries.
A bank reports a suspicious transaction or a client to FinCEN in Suspicious Activity Reports (SARs); 2,121 files of the total leaked are SARs. These documents containing
guarded secrets of many banks were sent to US authorities between 1999-2017.
Documents reportedly reveal how big banks allowed money laundering worth $2 trillion. It also revealed how Russian oligarchs or businessmen supplied money to the West and avoided sanctions that prevent them from using banks.
Leaked files gave insight into what banks know about the vast flows of dirty money across the globe.Fergus Shiel, International Consortium of Investigative Journalists (ICIJ)
What Did It Reveal?
- Fraudsters used HSBC to move millions of dollars of stolen money around the world. HSBC despite knowing about the Ponzi scheme of transfer of millions of stolen dollars, just filled SARs and didn’t intervene to stop it.
- JP Morgan was accused of allowing a company to move more than $1 billion through a London account without knowing its owner.
- UK’s governing Conservative Party secretly received £1.7 million from a Russian oligarch with close ties to President Putin.
- One of Vladimir Putin’s closest associates used Barclays bank in London to supply money to the West and avoided sanctions that prevent him from using banks.
- SARs of over 3000 UK-based companies – more than any other countries – found in the leaked documents.
- Roman Abramovich, the owner of Chelsea, used an offshore company to fund footballers not owned by his club.
- Standard Chartered was moving money which was used to fund terrorism.
- Deutsche Bank found moving money of money launderers, organized criminals, terrorists, and drug traffickers.
India Under Radar?
Files revealed the names of at least 44 Indian correspondent banks involved in the money transfer. SBI, Kotak Mahindra, HDFC Bank, Punjab National Bank, Canara Bank, etc have been named. Files contain critical information on doubtful money transactions carried out in these banks from a bankrupt steel plant, a multinational conglomerate, an IPL sponsor, etc. The report says that Indian banks received $482,181,226 from outside the country and transferred $406,278,962 from India.
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