FinCEN leaks Blitz

: money, September 22 2020 ▶

Do you remember how in April 2016 ~215K offshore accounts leaked in Internet ... and nothing happened? Yeah, nothing - no imprisoned people, no investigations, no penalties. I am talking about the normal things that will happen to you, almost immediately, if you cheat with $1.3 billion. Well, you can mark my words now - nothing will happen again, as we are heading for the biggest leak to date. And this time we are talking about $2 trillion.
The good guys from the BuzzFeedNews.com received an incredible trove of documents and analyzed it for us. I am writing this, hoping it is not all "fake news". Here are the main articles, and I think there will be more in the upcoming days:
Dirty money pours into the world's most powerful banks
We Got Our Hands On Thousands Of Secret Documents. Let's Break Them Down.
Billions in dirty money rolled through Deutsche Bank.

The BuzzFeed's articles are pretty big, I do not expect many people will read them thoroughly, but I did. As the title shows, you will get the main points and my thoughts on what we have so far. Future updates may follow. Let's go!

FinCEN is an agency, within the US Treasury Department. Its main task is to fight money laundering. When banks operate, they are obliged to file "suspicious activity reports" (SARs). This does not take away the responsibility of the banks to shut down such activities. Banks have their own systems and statistical methods to identify financial crimes, and, as you can imagine, unless tampered with, they are very effective. Money laundry is a big problem. When the dirty money hit the normal economy, all things, metrics and principles become twisted. Suddenly the house prices rise with 15% YOY and things become more and more unreachable for the average Joe.
So FinCEN receives the reports, but claims it has no capacity (lack of employees, political pressure) to analyze them all. BuzzFeed received 2100 SARs with information dating back to 1999, but primarily 2011-2017. They gathered a bunch of journalists, tried some automatic analysis, realized it's not going to work, as the SARs are just random mess of data, and then sat down, pulled out the data and structured it by hand.

The documents are secret - the procedure is part of some gov-to-bank agreement and neither banks, nor the authorities admit they have such. Nobody wants to lose customers, of course! Government also presses the investigators to stand down. Hurting major players may hurt the economy...and the cycle closes.
Ok, hold on a second! If in 2000 SARs you see $2 SUSPICIOUS TRILLION, what will come out if you go through all 2mil SARs? Who are the bad boys? Below are just the major players:
And the largest SARs - again a small snippet:
Who transferred money? Mafia (mostly russian), terrorist, drug dealers, fraudsters - basically everyone who had enough dirty money to be able to sustain the heavy bank fees and possible bribes. Aren't the CEOs afraid this will get them to jail? No, there was not a single big fish on the hook. Not even charges. Banks even calculated what amount they will pay in a possible lawsuit "agreement" beforehand. They just played "stupid", because they knew they will get away with it. And the penalties are nothing, compared to the gains.For the people with really short memory - JPMorgan Chase and Citigroup (SARs from Citibank) basically caused THE BIG market crash in 2008 and was bailed-out with $25B each(!); Bank of America Corp (SARs from Bank of America) got $15B; Deutsche Bank got $12B in 2008, $2B in 2011 from ECB and a couple of billion from the German taxpayer every year since.

BuzzFeed journalists focus on Deutsche Bank, because of the insane cash flow from their russian offices and the interesting facts around their CEO - Christian Sewing (2018-to-date), who was head of the bank's audit division during the events. He had such an amazing career development, it is just worth googling alone - will not spoil it for you.
Some other interesting topics:
- The collection does not include any SARs about Trump's finances. I am pretty sure journalists put a lot of extra effort on digging something, but they got "only" a former Trump's campaigner and a Pacific casino, run by his former employee.
- Russian laundromat - UK-based company lends money to another, guaranteed by Russian or Moldovan companies, then it gets sued in Moldova, then the russian companies "have to transfer" money to the UK-based bank
- $10 billion mirror trading scheme - buy shares in Russia and sell the stock to one of the European shell companies you own (via Deutschebank)
- DBank hires Deloitte auditors - "independent check" shows "all green" in Moscow's office (guess who was Managing the Risk in DB at that time)

- Currently all banks deny any allegations and claim their anti-fraud procedures are top-notch. Deutschebank's official said this information is nothing new, it is already shared with the authorities and DB has paid all "agreements".
- In 2012, HSBC was fined $2B for making shady business with countries like Sudan and Myanmar (apparently banned in US). SARs show that almost nothing changed afterwards. I guess that nowadays "minus $2B" is almost nothing for a big bank.

All things considered, I believe we are having just a glimpse at the tip of the iceberg. No prosecution will follow. No CEOs will go to jail. The story will be slowly buried and forgotten. I remember the time when the movie villain demanded "3 million dollars!" or he destroys the world...boy things changed!