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News ID: 83058
Publish Date : 21 September 2020 - 21:48

Bank Shares Dip With $2 Trillion of Suspect Flows Under Scrutiny

HONG KONG/LONDON (Reuters) - Global banks faced a fresh scandal about dirty money on Monday as they sought to limit the fallout from a cache of leaked documents showing they transferred more than $2 trillion in suspect funds over nearly two decades.
Britain-based HSBC, Standard Chartered and Barclays , Germany’s Deutsche Bank and Commerzbank, and JPMorgan Chase & Co and Bank of New York Mellon Corp were among the lenders named in the report by the International Consortium of Investigative Journalists and based on leaked documents obtained by BuzzFeed News.
While some banks said many of the transactions happened a long time ago, and they had since put robust anti-money laundering checks in place, investors were clearly worried.
HSBC and StanChart shares touched their lowest level in as much as 25 years, although they fared little worse than their peers amid a wider selloff in global stocks.
The reports were based on 2,100 leaked suspicious activity reports (SARs), covering transactions between 1999 and 2017, filed by banks and other financial firms with the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCen).
Banks have spent billions bolstering their anti-money laundering procedures in recent years after many faced huge fines for rule breaches. They are required to file an SAR whenever handling funds that cause grounds for suspicion of criminal activity.
But an analysis of 2,100 SARS obtained by BuzzFeed News, which worked with the International Consortium of Investigative Journalists and other media organizations, found some reports were filed months after the suspect transactions took place and that often little other follow-up action was taken.
"This brings out the point that managing financial crime risk goes beyond making SARs,” said Etelka Bogardi, a Hong Kong-based financial services partner at Norton Rose Fulbright.
Shares of Deutsche Bank, which was involved in the largest number of SARs in BuzzFeed’s dossier, were down more than 8% at one point on Monday morning following the reports.