A win for Shah would have sparked a wholesale review of the way banks handle and report their internal suspicions of money laundering… The Shah battle raised the burdensome scenario of banks having to justify every suspicious activity report (SAR) that they filed. The banking industry files the vast majority of the 250,000 or so SARs that reach SOCA each year. Under UK law bank employees risk committing criminal offences if they fail to report money-laundering suspicions.

At least some good news for HSBC on their anti money laundering activities; the US branch is still under scrutiny for its internal AML processes.

http://www.reuters.com/article/2012/05/17/us-hsbc-shah-relief-idUSBRE84G1EP20120517

The main changes are:

• Combating the financing of the proliferation of weapons of mass destruction through the consistent implementation of targeted financial sanctions when these are called for by the UN Security Council.
• Improved transparency to make it harder for criminals and terrorists to conceal their identities or hide their assets behind legal persons and arrangements.
• Stronger requirements when dealing with politically exposed persons (PEPs).
• Expanding the scope of money laundering predicate offences by including tax crimes.
• An enhanced risk-based approach which enables countries and the private sector to apply their resources more efficiently by focusing on higherrisk areas.
• More effective international cooperation including exchange of information between relevant authorities, conduct of joint investigations, and tracing, freezing and confiscation of illegal assets.
• Better operational tools and a wider range of techniques and powers, both for the financial intelligence units, and for law enforcement to investigate and prosecute money laundering and terrorist financing.

Of these updates, the inclusion of tax crimes as predicate offense has been the most controversial. While everyone would agree that banks should be contributing to the detection of terrorist financing and money laundering, the monitoring of tax evasion by banks can be extremely burdensome (if possible at all), while the impact on the overall financial crime arena has not been gauged. Anyway, tax crimes are in the FATF recommendations as a predicate offense for money laundering, so member states will definitely follow suit to include tax crimes in AML requirements.

What happened with the criminal case against Holenweger ? Not enough evidence, according to the judge. A blow to prosecutors in this high profile case. Details on the Alstom case will follow as they pop up.

http://bit.ly/gigJp3

http://bit.ly/fWoHEB

http://bit.ly/dfiQqA

http://bit.ly/fn1TD3

http://financialcrimeonline.com/archives/875

http://bit.ly/dfiQqA

“The laundering of money is a problem that worsens from day to day because billions of dollars have been laundered and injected into the country’s formal economy over several years,” the senator said during the inauguration Wednesday of the “Seminario Internacional sobre Corrupcion y Lavado de Dinero” (International Seminar on Corruption and Money Laundering).

“This problem has disrupted banking institutions, investment firms and businessmen, and I believe it is time for a good law that will allow us to strike a blow at the finances of organized crime groups,” Navarrete, who serves as coordinator of the Party of the Democratic Revolution, or PRD, caucus in the Senate, said.

http://financialcrimeonline.com/archives/898

http://latino.foxnews.com/latino/news/2011/02/10/money-laundering-reaches-bn-annually-mexico/

http://www.bbc.co.uk/news/10324861

From the information that surfaced, ‘ Eaglewood’  probably started in 2007 when undercover detectives were following two convicted drug dealers to an unknown individual, who was later identified as Eyad Iktilat. After being arrested, one of them was found to have been carrying over 1,36 million euros in a bag.

Iktilat appeared to be a big fish, with plenty of luxury cars and real estate. Royal Oak Taxis, a rundown, fortified garage and cafe was run by Israeli-born Iktilat.  He was also a director of the nearby Euro Foreign Exchange, through which up to £1m a day in drug money would be laundered.

Iktilat, of Euston, north London, denied counts of money laundering, conspiracy to supply cocaine and cannabis, and possession of cocaine, but was convicted after a five-month trial. Initially jailed for 21 years, his sentence was increased to 30 on appeal. “He did not believe he was doing anything wrong. He believed he was acting as a bank,” said an officer. In two years, an estimated £100m passed through the ramshackle breeze-block taxi building. It was then taken to the bureau de change. There, manager Jean-Claude Frigieri, 56, of West Molesey, Surrey, bought up to €450,000 at a time, sometimes several times a day, from a bank note wholesaler called Interchange, which had no idea about his criminal dealings. He was convicted of money laundering and jailed for 10 years.

The money laundering consisted of buying 500 euro notes at Euro Foreign Exchange with drug money; the first stage in concealing the dirty origin of the money. And a perfect way to reduce the weight and volume of the drug money. Did you hear that Colombian cartels prefer 500 euro notes as payment for supplying cocaine rather than $100 notes?

The Guardian reports that Iraqi refugee Maythem al-Ansari was the main banker. When police swooped on his £3m west London home they had to use a digger and angle grinders to smash through a fortified security wall. He arrived in Britain in 1999 as Mithum Mohammed, later changing his name to al-Ansari, a famous banking name in Saudi Arabia. He worked as a bus driver but swiftly built up a multi-million-pound property empire. By 2004 he was investing in restaurants and vineyards and specializing in properties in Park Lane and Mayfair. The 42-year-old used business links to lend an air of legitimacy, and could exchange large amounts without attracting suspicion, making him the perfect cover for someone to change large amounts of cash into euros.

For a 5% ‘ introduction fee’ criminals could use the money laundering services of the taxi company, being the exchange to 500 euro notes. Details on the use of the notes were not made public, but you can assume they were used to pay for the cocaine on one hand, and used to invest in real estate and other goods for the criminals themselves on the other. Only a couple of criminals actually build up a ‘ legitimate’  business with dirty money. Most of them just try to find ‘clever’ ways to enjoy their lifestyles without being caught in the web…

Among the sentenced was a London ‘hero’ fire fighter, commended for his role in the bombing response, who was going down in the aftermath of the London bombings. He was on sick leave suffering from ‘ stress’ .  Owning two audis and leading a ‘ champagne lifestyle’ , some people had some doubts about the ‘ stress’ . He was however arrested while putting 100 kilogram of cocaine in smaller bags. The drugs had been picked up from a beach in the a coastal town the previous night, having been smuggled from continental Europe on a rigid-hulled inflatable speedboat. Try to talk you out of that one; that must be stressy.

http://www.bbc.co.uk/news/uk-12120309

http://www.bbc.co.uk/news/uk-11930487

http://www.guardian.co.uk/world/2011/jan/05/police-smash-london-drug-gangster-syndicate

http://www.policeprofessional.com/news.aspx?id=11787

Other transactions that probably are under investigation involve the oil business. Some of the money that was transferred to Switzerland is believed to have come from illegal commissions and other fraudulent means between 2000 and 2005, when he presided over the KazTransOil state company, according to Bruno de Preux, the Geneva lawyer who is representing a group of Kazakh citizens “opposed to state corruption”.

Some months ago, the Kazakh financial police investigated him on corruption allegations to no avail. In June 2010, embezzlement accusations against Kulibayev were ruled groundless by an Almaty court.

http://bit.ly/h7BXyC

http://bit.ly/hcVW4q

http://bit.ly/i53kPb

http://www.bbc.co.uk/news/world-latin-america-11193687

http://www.youtube.com/watch?v=7D3L7RrwhOQ

http://mafiatoday.com/sicilian-mafia-ndrangheta/a1-15b-seized-over-mafia-links-in-italy/

http://www.tg1.rai.it/dl/tg1/2010/articoli/ContentItem-f3352d8d-c3fd-4ce6-9cd3-1e0b924fb2cb.html

During 2007, RBS processed the largest volume of foreign payments of any UK financial institution, the FSA said. But between 15 December 2007 and the end of 2008 the bank’s brands – RBS, NatWest, Ulster Bank and Coutts – failed to adequately screen their customers and the payments they made and received, against a government list of proscribed individuals. The list of those involved in financing terrorism was first drawn up in 2001 after the 9/11 terror attacks in the US and last year included 500 organisations, a dozen of which were based in Britain, and 1,400 people, about 50 of whom were UK residents. The lack of controls at RBS resulted in an unacceptable risk that the bank could have facilitated transactions including terrorist financing, the FSA said. It added that RBS’s failings were particularly serious because of the risk they posed to the integrity of the UK financial services sector.

RBS, which qualified for a 30 percent reduction in the fine because it agreed to settle at an early stage of the FSA investigation, said that it accepted the findings of the FSA investigation and had taken steps to remedy the sitation. ”It confirmed the deficiencies we had identified and brought to their attention, in our policies, procedures and controls … though the FSA noted that it did not consider this misconduct deliberate or reckless,” said Nathan Bostock, RBS’ head of restructuring and risk.

http://www.businessweek.com/ap/financialnews/D9HBUN500.htm

http://www.guardian.co.uk/business/2010/aug/03/royal-bank-of-scotland-fsa-biggest-fine

http://online.wsj.com/article/SB10001424052748704532204575397543634034112.html