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Government Documents Reportedly Show Some of the World’s Biggest Banks Moving Illicit Funds

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  • Reports from BuzzFeed News and the International Consortium of Investigative Journalists detailed findings from leaked government documents which found that some of the biggest global banks moved money for criminal networks and profited from doing so.
  • The documents they drew from are known as suspicious activity reports. Very few of those reports have ever been publicized, but this leak contained 2,100 of them.
  • According to BuzzFeed, the reports revealed that major lenders like JPMorgan Chase and Deutsche Bank moved than $2 trillion in suspicious transactions between 1999 and 2017. 
  • BuzzFeed alleged that most banks could have stopped the transactions, but they often kept the money moving to collect fees and profit off the illicit funds “while facilitating the work of terrorists, kleptocrats, and drug kingpins.”
  • For the most part, banks cannot legally comment on these reports, but in statements responding to the story, many claimed to have made significant improvements to their abilities to fight financial crimes. 

BuzzFeed News’ SAR Bombshell

Some of the biggest banks in the world have helped suspected terrorists, drug cartels, rogue states, and other criminal networks move trillions of dollars, according to new reports published Sunday by BuzzFeed News and the International Consortium of Investigative Journalists (ICIJ).

The reports detail findings from thousands of leaked government documents called suspicious activity reports (SARs). Those reports, which banks are required to file if they suspect their clients of engaging in money laundering, fraud, or other illegal activity, are sent to the Financial Crimes Enforcement Network (FinCEN), an agency housed in the Treasury Department that is tasked with combating financial crimes.

FinCEN collects millions of SARs each year and sends them to law enforcement agencies all over the world. Notably, the SARs themselves do not provide evidence of wrongdoing, and the agency does not require banks to stop doing business with clients it flagged in SARs.

The investigative pieces by BuzzFeed and the ICIJ, which have been dubbed the FinCEN Files, provide an incredibly significant look into the secretive banking reports. As BuzzFeed notes, very few SARs had ever been revealed to the public prior to their reporting.

“The FinCEN Files encompass more than 2,100,” the outlet wrote, adding that the FinCEN Files “offer an unprecedented view of global financial corruption, the banks enabling it, and the government agencies that watch as it flourishes.”

According to BuzzFeed, in all, the SARs they reviewed “flagged more than $2 trillion in transactions between 1999 and 2017. Western banks could have blocked almost any of them, but in most cases they kept the money moving and kept collecting their fees.”

“[The] huge trove of secretive government documents eveals for the first time how the giants of Western banking move trillions of dollars in suspicious transactions, enriching themselves and their shareholders while facilitating the work of terrorists, kleptocrats, and drug kingpins,” the article said. “And the US government, despite its vast powers, fails to stop it.”

Specific Examples

Regarding the government response, BuzzFeed writes: “In the rare instances when the US government does crack down on banks, it often relies on sweetheart deals called deferred prosecution agreements, which include fines but no high-level arrests.”

“Laws that were meant to stop financial crime have instead allowed it to flourish,” the report continued. “So long as a bank files a notice that it may be facilitating criminal activity, it all but immunizes itself and its executives from criminal prosecution. The suspicious activity alert effectively gives them a free pass to keep moving the money and collecting the fees.”

“Banks often get to the end of their agreement without actually fixing the problems. Then, instead of getting the prosecution that they had been threatened with, they just get another chance. And sometimes another.”

BuzzFeed then goes on to explicitly flag five banks, writing that its investigation “shows that even after they were prosecuted or fined for financial misconduct, banks such as JPMorgan Chase, HSBC, Standard Chartered, Deutsche Bank, and Bank of New York Mellon continued to move money for suspected criminals.”

BuzzFeed mentions a number of examples regarding those banks. One of the most outstanding instances concerned Standard Chartered, which BuzzFeed said moved money for a Dubai-based business called Al Zarooni “that was later accused of laundering cash on behalf of the Taliban.” 

During the years that Al Zarooni was a Standard Chartered customer, “Taliban militants staged violent attacks that killed civilians and soldiers.”

The report also says the SARs BuzzFeed accessed showed that HSBC’s Hong Kong branch, “allowed WCM777, a Ponzi scheme, to move more than $15 million even as the business was being barred from operating in three states.”

That scam stole at least $80 million from investors, most of whom were Latino and Asian immigrants. According to authorities, the company’s owner “used the looted funds to buy two golf courses, a 7,000-square-foot mansion, a 39.8-carat diamond, and mining rights in Sierra Leone.”

In addition to those two banks, the outlet also reported that “Bank of America, Citibank, JPMorgan Chase, American Express, and others collectively processed millions of dollars in transactions” for the family of the former mayor of Kazakhstan’s most populous city, who was later convicted of “bribe-taking and defrauding the city through the sale of public property.”

BuzzFeed claimed that those banks continued to process those transactions “even after Interpol issued a Red Notice for his arrest.” 

Separately on Sunday, NBC News, which also viewed the same SARs, published an article claiming the documents showed that “North Korea carried out an elaborate money laundering scheme for years using a string of shell companies and help from Chinese companies, moving money through prominent banks in New York.”

“The suspected laundering by North Korea-linked organizations amounted to more than $174.8 million over several years, with transactions cleared through U.S. banks, including JPMorgan Chase and the Bank of New York Mellon,” NBC added, noting that this occurred at the same time the U.S. had put strict economic sanctions against the country in place.

Response From Banks & FinCEN

FinCEN has not released any statements since the reports came out, but it does appear they knew the exposé was coming.

In a statement published Sept. 1, the agency said it was “aware that various media outlets intend to publish a series of articles based on unlawfully disclosed (SARs).”

“The unauthorized disclosure of SARs is a crime that can impact the national security of the United States, compromise law enforcement investigations, and threaten the safety and security of the institutions and individuals who file such reports,” it added.

FinCEN also seemed to respond to reports that the SARs would be leaked by doing early damage control. On Sept. 17, just days before media outlets prepared to publish the documents, the agency published another statement announcing plans for a huge overhaul of national anti-money laundering rules.

Many of the banks mentioned by BuzzFeed have also responded to the article in a series of lengthy statements where each lender reiterated the fact that they cannot legally comment on SARs. They also noted that they have made improvements over the years when it comes to fighting financial crimes and money laundering. 

Regarding the release of the SARs themselves, BuzzFeed says it would not publish them because “they contain information about people or companies that are not under suspicion,” and added that some of the documents will be published later with redactions “to support reporting in specific stories.”

Currently, it is unclear if these bombshell reports will move the needle when it comes to reforms and overhauls. 

“If the government wanted to, experts in financial crime say, it could stop the dirty money coursing through the big banks, as well as the vast array of criminal activity it funds,” BuzzFeed wrote. 

Reforms that could be made, according to the outlet, include greater public accountability, arresting and prosecuting executives whose banks break the law, and requiring companies “to disclose their owners to the Treasury Department, rather than allowing people to hide behind a shell company.”

Additionally, while these reports are likely some of the biggest insights into SARs ever made public, they are just the tip of the iceberg.

“The FinCEN Files represent less than 0.02% of the more than 12 million suspicious activity reports that financial institutions filed with FinCEN between 2011 and 2017,” ICIJ noted in their version of the publication.

What’s more, in the last two years alone, FinCEN received “more than 2 million SARs” according to BuzzFeed.

“That number has nearly doubled over the past decade, as financial institutions have faced mounting pressure to file and the volume of international transactions has grown,” the outlet added. “Over the same period, FinCEN’s staff has shrunk by more than 10%. Sources there say most SARs are never even read, let alone acted upon.”

With that information in mind, the big question then becomes: will there be pressure from the public?

Even if it does, as The New York Times points out, it is unclear if that pressure would outweigh the sway big banks have on the government. 

“Recently, banks have pushed Congress to relieve them of some of their anti-money-laundering responsibilities,” The Times reported. “They say they are so worried about the legal consequences of failing to report suspicious activities that they err on the side of over-reporting transactions.”

See what others are saying: (NBC News) (The New York Times) (Business Insider)

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Amazon Backs GOP Bill to Legalize Marijuana in Effort to Ramp Up Lobbying

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The proposal is the first Republican-sponsored marijuana bill Amazon has backed since the company first began lobbying for legalization last summer.


Amazon Endorses States Reform Act

Amazon announced Tuesday that it is endorsing a Republican-backed proposal to legalize marijuana.

The move comes as the e-commerce giant has ramped up its efforts to legalize cannabis on the federal level since it came out in support of the idea last summer. Amazon argues that the move would remove hiring barriers — which disproportionately impact people of color — and, in turn, could increase the company’s application pool and boost employee retention.

The company has previously backed similar proposals by forward by Democrats, but Tuesday’s announcement marks the first time Amazon has put its support behind a Republican-sponsored bill aimed at addressing the issue.

The legislation, called the States Reform Act, was authored by Rep. Nancy Mace (R-S.C.). Among other measures, it would remove cannabis as a Schedule I substance, allow states to create their own laws, impose an excise tax, and regulate the drug in a similar fashion to alcohol.

While Mace’s bill is fundamentally very similar to others put forth by Democrats, by proposing it herself, the Republican hopes to rally other members of her party around the idea that legalization is pro-business, pro-state’s rights, and anti-big government.

The measure has already received support from the highly influential conservative group, American’s for Prosperity, which is funded by the Koch brothers.

Potential Momentum

Mace and Amazon have painted the company’s endorsement as a game-changer for garnering more support — both from other large corporations and politicians on either side of the aisle. Mace specifically told reporters she believes Amazon’s decision will push other companies to do the same. If more major corporations like Amazon back the effort, other Republicans may be more persuaded to jump on board.

That sentiment was echoed by Brian Huseman, Amazon’s vice president of public policy, who said in an interview with The Washington Post that the company was “particularly excited by Congresswoman Mace’s bill because it shows that there’s bipartisan support for this issue.”

Huseman also emphasized that, as part of its decision to back her bill, Amazon will use its powerful influence in Washington to try and drum up bipartisan support.

“We are talking with members of both parties, including Republicans, about why we think this is the right thing to do, especially from the standpoint of a major employer and what this means for our business and our employees and broadening the employee base,” he continued.

See what others are saying: (The Washington Post) (Forbes) (Marijuana Moment)

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CDC Data Shows Booster Shots Provide Effective Protection Against Omicron

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Public health experts have encouraged Americans to get boosted to protect themselves against the omicron variant, but less than 40% of fully vaccinated people who are eligible for their third shot have received it.


A First Glimpse of Official Data on Boosters and Omicron

COVID-19 booster shots are effective at preventing Americans from contracting omicron and protecting those who do become infected from severe illness, according to three reports from the Centers for Disease Control and Prevention (CDC) published Friday.

The reports mark the first real-world data regarding the highly infectious variant and how it has impacted the U.S.

One of the CDC reports, which studied data from 25 state and local health departments, found that there were 149 cases per 100,000 people among those had been boosted on average each week. 

In comparison, the figure was 255 cases per 100,000 people in Americans who had only received two shots.

Another study that looked at nearly 88,000 hospitalizations in 10 states found that the third doses were 90% effective at preventing hospitalization. 

By contrast, those who received just two shots were only 57% protected against hospitalization by the time they were eligible for a booster six months after their second dose.

Additionally, the same report also found that the boosters were 82% effective at preventing visits to emergency rooms and urgent care centers, a marked increase from the 38% efficacy for those who were six months out from their two-shot regime and had not yet received a third.

Low Booster Shot Vaccination Rates

Public health officials hope that the new data will urge more Americans to get their booster shots.

Since the emergence of omicron, experts and leading political figures have renewed their efforts to encourage people to get their third shots, arguing they are the best form of protection. 

The CDC currently recommends that everyone 12 and older get a booster shot five months after their second shot of Pfizer and Moderna or two months after receiving the single-dose Johnson & Johnson vaccine. Still, in the U.S., less than 40% of fully vaccinated individuals eligible for a third shot have gotten one.

While COVID cases in the country have begun to drop over the past several days from their peak of over 800,000 average daily infections, the figures are still nearly triple those seen in the largest previous surges.

Hospitalizations have also slowly begun to level out over the last week in places that were hit first, such as New York City and Boston, but medical resources still remain strained in many parts of the country that experienced later surges and have not yet seen cases slow.

Some experts predict that the U.S. will see a sharp decline in omicron cases, as experienced in South Africa and Britain. Still, they urge American’s to get boosted to ensure their continued protection from the variant, as well as other strains that will emerge.

See what others are saying: (The Washington Post) (CNN) (The New York Times)

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California Bill Would Allow Kids 12 and Up to Get Vaccinated Without Parental Consent

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Nearly one million California teens and preteens between the ages of 12 and 17 are not vaccinated against COVID-19. 


State Senator Proposes Legislation

Legislation proposed in California on Thursday would allow children age 12 and up to get vaccinated without parental consent. 

State Sen. Scott Wiener (D-San Francisco) introduced Bill 866 in the hope it could boost vaccination rates among teenagers. According to Wiener, nearly one million kids aged 12- to 17-years old remain unvaccinated against COVID-19 in the state of California. 

“Unvaccinated teens are at risk, put others at risk & make schools less safe,” Wiener tweeted. “They often can’t work, participate in sports, or go to friends’ homes.”

“Many want to get vaccinated but parents won’t let them or aren’t making the time to take them. Teens shouldn’t have to rely on parents’ views & availability to protect themselves from a deadly virus.”

Currently, teens in California can receive vaccines for human papillomavirus and hepatitis B without parental consent. They can also make other reproductive or mental healthcare choices without a guardian signing off. Wiener argues that their medical autonomy should expand to all vaccines, especially during a pandemic that has already killed roughly 78,000 Californians. 

Vaccine Consent Across the U.S.

“Teens shouldn’t have to plot, scheme or fight with their parents to get a vaccine,” he said. “They should simply be able to walk in & get vaccinated like anyone else.”

Bill 866 would allow any kids ages 12 and up to receive any vaccine approved or granted emergency use authorization by the Food and Drug Administration and recommended by the Centers for Disease Control and Prevention. Currently, Pfizer’s COVID vaccine has been fully approved by the FDA for those 16 and older. It has received emergency authorization for ages five through 15. 

Across the United States, vaccine consent ages vary. While the vast majority of states require parental approval for minors to be vaccinated against COVID-19, kids as young as 11 can get the jab on their own in Washington, D.C. In Alabama, kids can receive it without parental consent at 14, in Oregon at 15, and in Rhode Island and South Carolina at 16. According to the Kaiser Family Foundation, providers can waive consent in certain cases in Arkansas, Idaho, Washington, and Tennesee.

In October, California became the first state to announce plans to require that students receive the COVID-19 vaccine to attend class. The mandate has yet to take effect, but under the guidelines, students will be “required to be vaccinated for in person learning starting the term following FDA full approval of the vaccine for their grade span.” 

In other words, once the FDA gives a vaccine full approval for those aged 12 and up, it will be required the following session for kids in grades 7-12. Once it does so for kids as young as five, the same process will happen for children in kindergarten through sixth grade. There will also be room for exemptions from the mandate. 

The Fight to Vaccinate California

This week, a group of California state legislators formed a Vaccine Work Group in order to boost public health policies in the state. Wiener is among the several members who are “examining data, hearing from experts, and engaging stakeholders to determine the best approaches to promote vaccines that have been proven to reduce serious illness, hospitalization and death from COVID-19.”

“Vaccines protect not only individuals but also whole communities when almost everyone is vaccinated at schools, workplaces and businesses, and safe and effective COVID-19 vaccines have already prevented the deaths of hundreds of thousands of Americans,” Sen. Dr. Richard Pan (D-Sacramento) said in a press release. “Public safety is a paramount duty of government, and I am proud to join a talented group of legislators in the pro-science Vaccine Work Group who want to end this disastrous pandemic and protect Californians from death and disability by preventable diseases.”

While vaccine policies have been a divisive subject nationwide, including in California, state politicians and leaders are hopeful public health initiatives will prevail. 

“If we allow disinformation to drive our state policy making we will not only see more Americans needlessly suffer and die, but we will sacrifice the long term stability of our society having effectively abandoned the idea that we all must work together to protect each other in times of crisis.” Catherine Flores Martin, the Executive Director of the California Immunization Coalition, added. 

See what others are saying: (Los Angeles Times) (NBC News) (Sacramento Bee)

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