Last weekend, BuzzFeed News, International Consortium of Investigative Journalists, and more than 100 international news organizations released the FinCEN Files investigation detailing how a plethora of international banks are permitting financial transactions linked to drug cartels, human trafficking, and oligarchs. The series gets its name from the US Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) and is based on more than 2,100 leaked “suspicious activity reports” (SARs) and other US government documents.
U.S. law requires SARs be filed to FinCEN when a bank or a financial institution believes transactions moving through their organizations could involve money laundering, insider trading, cyber attacks or various types of fraud. These SARs are typically never revealed to the public and they are not available via Freedom of Information Act requests.
The FinCEN leaks involve more than $2 trillion USD worth of flagged transactions from 1999 to 2017. While the unprecedented look at SARs does offer a glimpse into the world international finance, the ICIJ says the 2,100 SARs represent less than .02 percent of the more than 12 million filed during this time period.
The transactions involve a wide range of international banks, including JPMorgan, HSBC, Deutsche Bank AG, and VTB Bank. Key highlights from the leaks and subsequent stories involve JPMorgan processing payments for “potentially corrupt individuals and companies in Venezuela, Ukraine and Malaysia”; HSBC laundering Ponzi scheme money ; and a Ukrainian billionaire being paid via Deutchse Bank AG. The ICIJ also includes a list of the billionaires exposed by the leaks. Most of the names will not be familiar to a western audience, save for Paul Manafort, Donald Trump’s former political strategist who was convicted of fraud in 2018. JP Morgan processed more than $50 million in payments for Manafort over a decade that were flagged as suspicious.
One story discovered in the SARs involves North Korea and an apparent money laundering scheme involving “a string of shell companies” and help from Chinese companies.
“Wire transfers from North Korean-linked companies with opaque ownership sometimes came in bursts, only days or hours apart, and the amounts that were transferred were in round figures with no clear commercial reasons for the transactions, according to the documents,” NBC wrote. “Graham Barrow, a London-based anti-money laundering expert, said those kinds of transactions are “red flags” and are all hallmarks of efforts to conceal the origins of illicit cash.”
Another story involved heroin, money laundering, and a man named Anthony Gomes. Gomes was arrested in 2017 and plead guilty to conspiring to launder money and to distribute drugs that killed Americans. Prosecutors alleged that Gomes and others were using offshore accounts, money transfers, a Bank of America account, and encrypted communication to wire money to China and Canada. Transactions involving Gomes and others were flagged in the SARs. Three of the eight people associated with Gomes have been charged with or convicted of drug trafficking.
HSBC – infamous for admitting to U.S. prosecutors in 2012 that it helped the Sinaloa drug cartel launder at least $881 million – is also heavily featured in the FinCEN leaks. HSBC was supposed to be under a five year probation period during which they would attempt to prevent money laundering via their banks. However, according to the SARs reports, during this time HSBC continued to offer banking services to alleged criminals, Ponzi schemers, shell companies and other funds for drug traffickers.
“Starting in 2012, HSBC embarked on a multi-year journey to overhaul its ability to combat financial crime across more than 60 jurisdictions. HSBC is a much safer institution than it was in 2012,” the bank said in response to the stories by BuzzFeed News and the International Consortium of Investigative Journalists.
The majority of the SARs come from German Deutsche Bank which had more than half the $2 Trillion-dollar sum of the FinCEN Files. The main focus is on Russian and Ukrainian oligarchs like Ihor Kolomoisky, “a Ukrainian oligarch with a reputation for heavy-handed tactics.” However, when it comes to Deutsche Bank, there is more to the story than what we are being told.
As MintPress News noted, “most of the press coverage in the U.S., so far, has focused on the ties to Russian oligarchs and assorted narratives that are hovering over election-year American political discourse. Deutsche Bank’s central role, nevertheless, betrays a far greater problem as the bank’s potential collapse could send the financial world into a tailspin and result in the greatest economic crisis in history.”
The MintPress News story delves into the deeper issues surrounding Deutsche Bank and the current legal battle involving the U.S. Department of Justice and the $11.7 Billion Malaysian sovereign wealth fund called 1MDB, one of the major cases highlighted by the FinCEN leaks. “Absent from most coverage of the FinCEN leaks, however, is how all of these banks and financial institutions are not only laundering trillions, but are doing so together and in consort with each other, as is plainly demonstrated in the 1MDB fraud case,” MintPress reported.
This observation is extremely important as we examine the leaks and who stands to benefit from the disclosure of this information.
The Omidyar Network
In 1997, the Center for Public Integrity launched the International Consortium for Investigative Journalists focused on issues such as “cross-border crime, corruption, and the accountability of power”. When examining the funding of both the CPI and the ICIJ a common source of funding emerges. For example, the CPI is funded by a number of familiar names such as the Carnegie Foundation, the Ford Foundation and the Democracy Fund. The Democracy Fund is an organization focused on “the leaders and solutions making American democracy more open and just.” The Democracy Fund’s main source of funding comes from eBay founder and former chairman Pierre Omidyar.
Meanwhile, Omidyar’s Omidyar Network is the source of funding for the ICIJ. The Omidyar Network is a so-called “social investment firm” founded by Pierre Omidyar in 2004. Through the Omidyar Network, Pierre Omidyar has been involved in funding First Look Media which publishes The Intercept, former home for the Edward Snowden archives. Omidyar and journalist Glenn Greenwald have been criticized for their closing of the Snowden archive.
MintPress News noted Omidyar’s involvement with the ICIJ. “In 2017, the year after the Panama Papers were leaked, and the same year a similar document trove called the Paradise Papers was released, Omidyar ponied up $100 million to fund media groups like the International Consortium of Investigative Journalists (ICIJ).”
MPN also noted that the ICIJ’s Offshore Leaks Database reveals that Omidyar himself is named in the documents. “The billionaire had apparently directed finances from his Omidyar Network Fund LLC into an “Offgrid Electric Ltd” in Seychelles – an island that the ICIJ itself called ‘a haven for dirty money.’”
This injection of cash into the ICIJ around the time of leaks which were potentially hazardous to Omidyar and his network of financial investments is curious to say the least. It is highly likely that financial activities involving Omidyar and his cohorts could have been revealed within the Panama Papers, Paradise Papers, or even the FinCEN leaks – had Omidyar not interfered. (To learn more about Omidyar and his efforts to shape and influence the digital landscape I highly recommend reading this 3 part investigation from MintPress News.)
Even more disturbing, is Omidyar’s well known association with CIA-connected USAID. Through his connections to USAID and other private firms, Omidyar and his technocrat crowd do their part to engineer the social fabric of our lives. As MintPress News noted during their investigation into Omidyar, “Omidyar, along with a select group of fellow billionaires, is also performing a critical service by providing a private funding channel for cultural vehicles that advance the agenda of Western foreign policy.”
Omidyar has also recently partnered with the Bill and Melinda Gates Foundation, the Rockefeller Foundation, and Mastercard to bring a digital ID system to Africa, as well as India. Gates and Omidyar also partnered on Radiant Earth, a satellite system aimed at mapping the earth to help in disaster recovery.
The moral of the story here is that the FinCEN leaks are being directed by organizations funded by technocrat Pierre Omidyar. Of course, it is true that his funding of the ICIJ does not immediately mean the journalists involved did not produce worthwhile journalism. Nor does it automatically mean that the leaks are a limited hangout. However, Omidyar’s connection to the leaks (and his sordid past) should raise alarm bells and readers should approach with skepticism.
Does Anyone Care?
Despite the many newsworthy stories within the FinCEN leaks, a deeper understanding among the public seems to be lacking. Within just one week of the story first breaking, the American public seems uninterested. There are too many things to be concerned about – the manufactured fear of COVID-19 and the manufactured Civil War, for example – for Americans to pay attention to yet another story of criminal banks. Caring about the banksters and Wall Street financial criminals is so 2011.
To be clear, the reporting is thorough and apparently took over a year for the teams of reporters to work their way through. The week of stories allowed former Presidential candidates and Senators Bernie Sanders and Elizabeth Warren to grab a headline by calling for more bank reform. The FinCEN even responded to the leaks with a warning that “the unauthorized disclosure of SARs is a crime that can impact the national security of the United States.” Days after the initial reporting, FinCEN announced plans for a public comment period for suggestions on how to “modernize the regulatory regime to address the evolving threats of illicit finance”, as well as “provide financial institutions with greater flexibility in the allocation of resources.”
That’s all positive news in light of what has been revealed. Yet there is still a sense that the FinCEN leaks were not sexy enough to keep the attention of the average person for longer than a few days (at best). Perhaps the nature of the apparently criminal activity was not vile enough to motivate the public to dissent. As the Straits Times reported, “analysts on Monday said the revelations were unlikely to lead to additional regulatory penalties or fines, because the behaviour detailed in the articles showed that the system is flawed, but did not make clear that the banks had broken any rules or laws.”
Overall, it appears the FinCEN leaks are newsworthy despite the apparent lack of interest. As we have outlined here, there are multiple layers to this story. The question to consider is whether Americans care about money laundering banks partnering with oligarchs and criminals? If they do care, then a call to address the root of these problems is necessary. Also, if we can hold their attention long enough to explain the underlying issues and potential for this leak to be used as a tool for manipulating public perception, perhaps we can have a discussion about the influence of organizations like the Omidyar Network and the Gates Foundation (and the technocrats who run them).
The FinCEN leaks reveal that abuses of the suspicious activity reports are commonplace throughout international financial institutions. However, the most damaging and interesting aspects of the leaks might be what they fail to reveal.
Originally published on Last American Vagabond by Derrick Broze.