4 big banks used by oligarchs, corrupt and criminals to move dirty money | The NY Journal

The so-called FinCEN Files have once again put several of the world’s leading banks such as HSBC, Barclays, JP Morgan and Deutsche Bank under the microscope.

The leak of the so-called FinCEN Files has once again put several of the world’s leading banks under scrutiny for their role in money laundering.

The files include thousands of “suspicious activity reports”Prepared by the same banks for the Financial Crime Control Network of the United States Department of the Treasury (FinCEN, for its acronym in English).

By law, any concerns regarding transactions made in US dollars must be reported to the FinCEN, even if it takes place outside of the US.

But while these confidential reports – known as SARs – do not necessarily constitute evidence of crime, there are several cases in the FinCEN Files that make you wonder. why some banks did not act after raising the alarms.

Below we compile 4 examples that involve some of the main banking institutions in the world and that surely are uncomfortable reading for those involved.

FinCEN Files strap


1. HSBC: an informed Ponzi scheme

HSBC Bank allowed scammers to move US $ 80 million money bad luck even after US investigators alerted them that they were the product of a scam.

According to documents in the FinCEN Files, Britain’s largest bank moved money through its US business to HSBC accounts in Hong Kong in 2013 and 2014.

HSBC and the FinCEN Files

HSBC doesn’t do particularly well in the FinCEN Files.

The scam in question, called WCM777, It was a Ponzi scheme, a type of fraud that pays early investors with money raised from new members.

It was started by the Chinese citizen Ming Xu, a pastor of evangelical churches who also claimed to operate a global investment bank called World Capital Market, which promised to pay 100% of the profits in 100 days.

Through roaming seminars on Facebook and webinars on YouTube, Xu – who denies operating a Ponzi scheme– raised US $ 80 million by selling alleged cloud computing investment opportunities.

Thousands of people from the US Asian and Latino communities invested in the fraudulent scheme, which ended up leading to the murder of one of its investors, Reynaldo Pacheco.

The scammers used Christian images to also attract poor communities in Colombia and Peru. There were also victims in other countries, including the United Kingdom.

In September 2013, California regulators informed HSBC that they were investigating WCM777.

And between October 2013 and March 2014 the bank issued three Suspicious Activity Reports (SARs) linked to WCM777, although it wasn’t until the U.S. Securities and Exchange Commission filed charges. in April 2014 that HSBC closed WCM777’s accounts with HSBC Hong Kong.

By then there was almost no money left in these, and lawyers for the duped investors say the bank should have acted earlier to close the scammers’ accounts.

Xu was arrested by Chinese authorities in 2017 and jailed for three years for the scam.

HSBC, which said it could not comment on individual cases, nonetheless insists that it always complied with its legal obligations.

The bank also noted that the information contained in the FinCEN Files was “historical and prior to the conclusion of our Deferred Prosecution Agreement (DPA) in 2017. ″

The agreement signed with the US authorities came after HSBC was fined US $ 1.9 billion in 2012 for money laundering of Mexican drug traffickers and promised to take drastic measures against this type of practice.

HSBC is a much safer institution than it was in 2012, ″ insisted the banking institution.

2. Barclays Bank: money from a friend of Putin despite sanctions

The FinCEN Files also suggest that one of the Russian president’s closest friends, Vladimir Putin, may have used Barclays Bank in London to launder money and evade sanctions.

The friend in question is the billionaire Arkady rotenberg, who has known the Russian president since childhood, and was sanctioned by the US and the EU in 2014.

Putin and Rotenberg have been friends since childhood.

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Putin and Rotenberg have been friends since childhood.

The sanctions mean Western banks could face serious consequences for doing business with him.

But Barclays says have complied with all its legal obligations.

In 2008, however, the bank opened an account for a company called Advantage Alliance.

And the leaked documents show that between 2012 and 2016 the company moved more than US $ 70 million using that account.

Many of the transactions occurred after Rotenberg and his brother Boris were sanctioned.

And according to a US Senate investigation from July this year, Advantage Alliance is one of the companies used by the Rotenbergs. to evade sanctions by secretly buying valuable works of art, for which he would have used his Barclays account in London.

Rotenberg and Putin in Sochi

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The Rotenberg companies have benefited from numerous contracts with the Russian state.

One of those works would be painting La Poitrine, by René Magritte, for which Arkady Rotenberg would have paid US $ 7.5 million.

On June 17, 2014, a company linked to the Russian oligarch sent the cash from Moscow to the Alliance’s account at Barclays.

The next day, the London bank sent the cash to the seller In New York.

In April 2016, Barclays launched an internal investigation into multiple accounts that it suspected were linked to the Rotenbergs.

Six months later, the bank closed the Advantage account.

But leaked Suspicious Activity Reports (SARs) show that other Barclays accounts with suspected links to the Rotenbergs they remained open until 2017.


Barclays claims to have complied with its legal obligations.

Barclays had no comment when asked by the BBC’s Panorama program how many accounts it suspected were owned by the Rotenbergs.

“We believe that we have complied with all our legal obligations and regulatory, including in relation to the sanctions of the United States, “said a spokesman for the institution.

“Since filing a SAR is not in itself evidence of any actual crime, we would only terminate a client relationship after careful and objective investigation and analysis of the evidence, balancing suspicions of potential financial crimes against risk. to ‘unseat’ an innocent customer, “added the Barclays spokesperson.

The Rotenberg brothers declined to comment.

3. JP Morgan: $ 1 billion from a possible mobster

According to the FinCEN Files, JP Morgan allowed a company to move more than $ 1 billion through a London account without knowing who the owner was.

Later, the bank found out that the company could be owned by a mobster on the list of ten FBI’s Most Wanted.

FBI poster on Semyon Mogilevich

Semyon Mogilevich is accused of belonging to the Russian mafia.

The suspect in question is Semiorn Mogilevich, a prominent member of the Russian mafia who has been charged with crimes including drug trafficking, arms trafficking and murder.

Banks have implemented measures to prevent organized crime profits from circulating through the financial system.

However, a suspicious activity report shipped by JP Morgan in 2015, after the implicated account had already been closed, reveals how his London office may have moved cash linked to Mogilevich.

The SAR details how between 2002 and 2013 JP Morgan provided banking services to a secret offshore company called ABSI Enterprises, although ownership of the company was not clear from the bank’s records.

In total, over a five-year period JP Morgan sent and received bank transfers associated with ABSI Enterprises for a total of US $ 1,020 million.

Fragment of the SARs on Mogilevich

Fragment of the SARs on Mogilevich.

The same SAR is the one that indicates that ABSI’s parent company “could be associated with Semión Mogilevich, an individual who was on the FBI’s 10 most wanted list.”

We follow all the laws and regulations in support of the government’s work to combat financial crime. We dedicate thousands of people and hundreds of millions of dollars to this important work ”, was the reaction of JP Morgan in a statement.

4. Deutsche Bank: at the forefront in suspicious transactions.

“Germany’s largest bank, Deutsche Bank, is no stranger to scandals,” acknowledges the German public television Deutsche Welle.

“But the FinCEN Files suggest that the bank knew it was facilitating suspicious transactions amounting to more than $ 1 trillion, even after promising to clean up its portfolio,” he says in the introduction to his story about the bank most mentioned in the leaked documents.

Deutsche Bank

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Deutsche Bank is the most mentioned bank in the FinCEN Files.

Indeed, Deutsche Bank was the generator of 62% of all suspicious activity reports (SARs) contained in the FinCEN Files.

And that means that of the $ 2 trillion in suspicious transactions mentioned in the documents, US $ 1.3 billion went through the German bank that in 2015 he was fined by the US authorities for money laundering.

Suspicious activity reports contained in FinCEN Files include transactions from 1999 to 2017, but are only a small part of all SARs generated during that period.

And that means Deutsche Bank is not necessarily the bank that reported the most suspicious activity.

The reports, however, leave no doubt that the bank helped move dirty money money launderers with links to organized crime, terrorists, drug traffickers and people and institutions subject to international sanctions.

And Deutsche Welle also highlighted that, in some cases, DB agreed to conduct suspicious transactions that had been rejected by other banking institutions.

Deutsche Bank

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Shares in several banks fell after the leak.

Deutsche Bank, however, assures that these practices are already thing of the past.

“This is not new information for us or for our regulators. The issues raised that relate to Deutsche Bank date back to the years prior to 2016, we ourselves reported them to our regulators and authorities and have been featured heavily in the media, ”DB said in a statement.

“We acknowledge past weaknesses in our control environment, apologize for it, and accept our respective fines. Most importantly, we learned from our mistakes, consistently addressed issues, and made changes to our business perimeter, our controls, and our people. (…) Now we are a different bank“, It reads in it.

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