Guru Gyan
Published in

Guru Gyan

The FinCEN Files Investigation

Leaked documents have revealed how some of the world’s biggest banks facilitated the move of illicit funds despite warnings about the origin of the money. The documents have been obtained and published by BuzzFeed News, International Consortium of Investigative Journalists (ICIJ) and 108 other media partners.

What are these documents?

The documents are part of a collection of files that belongs to the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN). Buzzfeed News shared with ICIJ more than 2,100 suspicious activity reports (SARs), filed by global banks to FinCEN.

*SAR is a confidential document filed by banks/financial institutions to the U.S. authorities when they observe suspicious transactions. These transactions, however, are not outright evidence of fraud or wrongdoings.

The documents identify more than $2 trillion in transactions between 1999 and 2017 that were flagged by financial institutions’ internal compliance officers as possible money laundering or other criminal activity.

The reveal

The report revealed that banks moved more than $2 trillion in payments they believed were suspicious over 18 years. HSBC, JPMorgan, Deutsche Bank, Standard Chartered and Bank of New York Mellon are the five global banks among many named that appeared most often in the documents.

The records showed that the above mentioned five banks kept profiting from powerful and dangerous players even after U.S. authorities fined these financial institutions for earlier failures to stem flows of dirty money.

The banks continued to wave through suspect payments despite promises to government authorities to improve money laundering controls, the secret documents showed.

The Indian names

The report revealed thousands of transactions extracted from the FinCEN Files to show an example of how potentially suspicious money travels around the world via networks of international and local banks.

Out of which, it showed 406 transactions that flowed to or from banks in India were flagged as potentially suspicious in the documents. Almost all major Indian banks were named for suspicious transactions including State Bank of India (SBI), Punjab National Bank, HDFC Bank.

According to the leaks, Indian banks received $482,181,226 from outside the country and transferred from India $406,278,962. These transactions were red-flagged to the U.S. authorities.

Putting the question,
‘These documents, compiled by banks, shared with the government but kept from public view, expose the hollowness of banking safeguards, and the ease with which criminals have exploited them,’ Buzzfeed reported.

The leak highlights the potential flow of dirty money, money laundering, and financial crimes. It also raises questions about the banks noticing this activity did not always act on the concerns as this is not the first time some big banks names have been involved in a scandal.

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