International money laundering

20 September 2020, 07:20 PM

quote:
Thousands of documents detailing $2 trillion (£1.55tn) of potentially corrupt transactions that were washed through the US financial system have been leaked to an international group of investigative journalists.

The leak focuses on more than 2,000 suspicious activity reports (SARs) filed with the US government’s Financial Crimes Enforcement Network (FinCEN).

Banks and other financial institutions file SARs when they believe a client is using their services for potential criminal activity.

However, the filing of an SAR does not require the bank to cease doing business with the client in question.

The documents were provided to BuzzFeed News, which shared them with the International Consortium of Investigative Journalists.

The documents are said to suggest major banks provided financial services to high-risk individuals from around the world, in some cases even after they had been placed under sanctions by the US government.

According to the ICIJ the documents relate to more than $2tn of transactions dating from between 1999 and 2017.

One of those named in the SARs is Paul Manafort, a political strategist who led Donald Trump’s 2016 presidential election campaign for several months.

He stepped down from the role after his consultancy work for former Ukrainian president Viktor Yanukovych was exposed, and he was later convicted of fraud and tax evasion.

https://www.theguardian.com/us...s-financial-activity

The BuzzFeedNews article:

https://www.buzzfeednews.com/a...tworks?ref=bfnsplash

And the ICIJ article:

https://www.icij.org/investiga...nals-and-terrorists/

20 September 2020, 07:38 PM

Doug

quote:
Banks and other financial institutions file SARs when they believe a client is using their services for potential criminal activity.

There’s a lot of misinformation in this quote, but the part I highlighted above is just flat out untrue.

Banks filed millions of SARs every year on any transaction that meets the thousands of ever-changing rules of transactions that must be reported to fincen. It does NOT mean the bank believes there is criminal activity.

The rules of the SAR reporting are not made public for obvious reasons, but I was quite familiar with them up to a couple years ago.

I can guarantee you that members of this forum have had an SAR filed on them.

20 September 2020, 09:23 PM

Axtremus

Doug, just curiosity on my part ... as a matter of implementation, do financial institutions just automate the the identification and reporting of SAR-worthy transactions (e.g., just program the "rules" into their computer systems and have the computer systems automatically spot and report to FinCEN) or do some humans have to sign off on every SAR?

Assuming a high degree of automation, how much time do financial institutions typically get to implement any change of "rules" that trigger SARs?