The Finken file investigation brings new banking laws


The world’s most powerful banks are giving a glimpse of the dirty money that government regulators, in its simplest form, transact. FinCEN file The investigation has turned the economic industry from the Great Depression into a story – and catalyzed strong action in the United States and beyond.

In the weeks following BuzzFeed News, a consortium of international investigative journalists and 103 newsrooms around the world began publishing stories based on the cache of confidential records, with UK lawmakers Formal investigation into the supervision of UK banks, Members of the European Parliament were in favor A strong response across the continent, And investigations were opened in several countries, from Thailand to Liberia.

Significantly, the Finsen files gave a final push to Washington DC for a moment. New law One of the most effective money laundering targets cited in the stories: anonymous shell companies. The law was passed last week with overwhelming bipartisan support, and many of these secretive American firms are required to disclose their ownership and what benefits they derive from them.

The Corporate Transparency Act has been identified as the largest amendment to anti-money laundering laws since the Patriot Act of 2001.

Provision The lawyer package also addresses many other systemic issues identified in the annual defense spending bill, identified in the Finken files, highlighting the ineffectiveness of government oversight and the countless ways in which banks fail to curb the flow of dirty money.

Among these reforms are: the judiciary’s need to submit an annual report justifying the use of deferred litigation agreements – well-known deals allow banks that have violated anti-money laundering laws to avoid trial and criminal penalties. The U.S. Treasury Department will also seek new technology to better identify criminal money flows and increase communication between the private sector and federal agencies. And those who play the whistle on misconduct get new protection.

Although President Donald Trump has promised to veto the additional bill – because it does not repeal any related protections for social media companies – lawmakers may ignore the veto.

Government officials cited BuzzFeed News-ICIJ as the reason for the investigation that the reforms were supported after years of inaction. “BuzzFeed’s story makes it clear that our country’s anti-money laundering laws need to be strengthened, reformed and updated,” said Sen. Sherrod Brown, a top Democrat on the Senate Banking Committee. “This action is chronic.”

Sen. Ron Wadden, a ranking Democrat in the Army Committee’s Finance Department, also referred to the Finsen files on the day the law was passed: “(Waden supported these reforms but voted against the broader law because it was not related to financial control.)

To investigate the Finnsen file, journalists from six continents investigated through a massive publication of suspicious activity reports or SARS from the U.S. Treasury’s Financial Crime Enforcement Network (Finsen). SARs have detailed more than 2 2 trillion in suspicious transactions in almost every corner of the globe, with journalists linking money laundering to terrorist groups, drug lords and clepcrats. The 16-month investigation established how banks helped facilitate money laundering and how national regulators failed to rule over criminals or crack down on banks.

A few weeks before the publication, journalists working on the Finsen files informed government officials about their findings and asked them to comment. Officers Us And the UK has announced that they will change anti-money laundering laws – the exact rules the Finsen files showed were broken and invalid.

After BuzzFeed News contacted the U.S. Treasury Department, the agency announced that it would begin seeking advice from the public and insiders on how to update the Banking Security Act of 1970, which has long been the country’s anti-money laundering policy. . Lobsters, banks, financial services firms and academics submitted 110 comments, many confirming what the Finken files showed: US anti-money laundering protections need to be badly restored

Meanwhile, on 18 February, two days before the story of the first Finken files was released, London officials Announced plan To improve the way the UK collects information about companies registered there.

“It’s hard to believe that the impending publication of the Finsen files has pressured them,” said Tom Keating, director of the Center for Financial Crime and Security Studies at the Royal United Services Institute.

As stories became public view, calls for reform grew louder.

British lawyers Has been turned on A formal investigation into the “deeply troubling” questions raised in the Finken files. Treasury Committee of Parliament Vows To examine the progress made by government regulators and law enforcement agencies in preventing money laundering.

Politicians are speaking in the European Parliament Called for uniform regulations And a new oversight body, or a larger body of existing entities, to oversee more in the form of European banking authorities.

“Existing anti-money laundering system Doesn’t work simply“It’s a Swiss cheese, full of holes,” said Iro Heineluoma, a Finnish member of the European Parliament, during the debate over the Finsen files.

Other national governments have also stepped in to investigate. In Seychelles and Liberia, publications by journalists referred to anti-corruption units for the next step.

At the same time, criminals and authoritarian regimes, long accustomed to keeping their financial transactions secret, chatter to journalists. Journalists from Africa and the Middle East were shouted at, intimidated and threatened with lawsuits before and after the release of the Finken file. In Turkey, a court has barred the publication of multiple Finken files.

At the same time, Finsen files have proven to be a powerful tool in the international fight for transparency and accountability.

Activists in Niger have filed the Finken file as part of a landmark case that forced the government to spend $ 120 million on a corruption probe that an official audit found missing. The regulators in Thailand Search The transactions of four domestic banks are by one Analysis For the series. And banks in Belgium Recommended Creating a platform for exchanging information about suspicious transactions and American banks supporting the law targeting shell firms.

In contrast, the lobbying arm of the banking industry has tried to take down the results of the investigation.

The Bank Policy Institute has issued a Statement, Backed by ads on social media, attempts have been made to throw cool water on the significance of the Finsain files.

The institute has disputed a central inquiry: that banks sometimes continue to process transactions for customers who are repeatedly flagged for suspicious behavior. The advocacy group says the government “frequently” asks banks to keep these accounts open so that law enforcement agents can monitor them.

Among the documents in the Finsein files, however, BuzzFeed News found only two references to such instructions.

The lobbying group also argued that a large portion of the SARS had nothing to do with illegal activity. Citing survey data from 14 banks, the team said: “Our data indicate that about four percent of SARS law enforcement pursues a follow-up. A small subset of these results is the result of an arrest and ultimately a conviction.”

The group added: “In the end, this means that 90-95% of the people the banks reported were probably innocent.”

However, the lack of official follow-up does not mean that the flagged activity was legitimate. Interviews with law enforcement officials show that federal investigators do not have the resources to pursue every lead and that banks do not automatically notify SARS after investigating matters.

By law, banks are required to identify transactions that carry the characteristics of money laundering or other financial misconduct. SARs themselves do not prove to be evidence of a crime, but it is important for them to continue to engage in illegal activities for law enforcement.

FBI Director Christopher Y. during a speech to the American Bankers Association this month Dr. SARs “capture the incredible behavior” and allow agents to “follow the financial path, investigate specific individuals and entities, identify leads, connect points, and investigate in advance.” Records obtained from law enforcement sources can help identify certain parts of drug networks, clear out funding behind terrorist cells, and help officials decide which agencies or individuals involved in the abuse will be blacklisted.

Contacting BuzzFeed News with questions for this story, the Bank Policy Institute once again cited its own research on the subject and reiterated that the Finsen files were based on “incredibly narrow” pieces of document, with millions of parts filed each year.

Immediately after the release of the Finken files, global banking stocks Trembling dramatically, But it was worth more than the shares that were buzzing in the industry. The series encouraged reflection and debate in various media and industry forums. “That banking scandal is a blur,” The Unique, A publication in the United Kingdom, mentioned. “Revisions … will be felt for months if not” “

In more than 100 opinion pieces and columns published in trade and business publications since September, industry experts have hinted at the Finken files in favor of change. At International Banker, Laurent Leotard-Vogue and Florent Playrett, who works at Chapuis Haldar & Co., a business management consulting firm, Recommended Solutions and terminations, including regulations for preventing shell organizations: “This whole system is on the verge of collapse and needs to be reconsidered.”

The Finsen file was released nine days after the investigation, said Superintendent Linda A. Laswell. New York State Department of Financial Services, Published his own Analysis, Noting that the series has provided an opportunity to address chronic problems. “Now, we must act with this new spotlight,” he wrote.

Sen, Elizabeth Warren, Member of the Committee on Banking, Housing and Urban Affairs, Quoted Stories calling for fundamental changes in observation.

In a statement to BuzzFeed News this week, he said the Corporate Transparency Act should be just the first step, and he would advise Wall Street on additional reforms, including making it more accountable for financial crimes. “I’m going to push myself Law Executives are personally and criminally liable when their agencies skirt the law. “



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