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Stay informed at a glance with top 10 stories
By Alun John, Sumeet Chatterjee and Lawrence White
HONG KONG / LONDON (Reuters) – Global banks faced a new dirty cash scandal on Monday as they sought to restrict the consequences of a leaked document that appeared to have transferred more than $2 trillion into a suspicious budget for nearly two decades.
HSBC Holdings Plc, Standard Chartered Plc and Barclays Plc, in the United Kingdom, Deutsche Bank AG and Commerzbank AG in the United States, as well as JPMorgan Chase
The report was based on 2,100 leaked suspicious activity reports (SAR), covering transactions between 1999 and 2017, recorded through banks and other monetary corporations with the US Treasury Department’s Financial Crime Execution Network. U. S. (FinCEN) . Banks must register one RAD each. they deal with budgets that lead to suspicions of criminal activity.
While some banks claimed that many transactions had been carried out a long time ago and that they had since put up position checks, reports revealed broader unrest with the surveillance formula at the global police center for cash laundering and other criminal activities.
Reports have attracted calls from some industry teams and activists for reforms. Investors are involved in the potential profits for global banks, many of whom have faced heavy fines in the afterlife for control violations and have spent billions of dollars on compliance.
“This confirms what we already knew: that massive amounts of fee claims are being filed and that a small number of cases are being taken to court,” said Etelka Bogardi, wife of Norton Rose Fulbright with Hong Kong-based monetary facilities.
“This also highlights the fact that managing the threat of monetary crime goes beyond achieving RS,” Bogardi said.
The Institute of International Finance, an industry group, has called for reforms. “We need to strike a balance between managing the threat of monetary crime and the monetary formula for valid clients,” the IIF said.
Lawmakers, regulators and banks have long identified basic failures in the anti-money laundering system. Regulations for what is considered “suspicious” can be vague, leading some banks to send too many reports and others to send too few. The execution organization is under staffed to manage the millions of RAS that want to be analyzed to determine whether a crime has been committed.
The shares of HSBC and StanChart have reached their lowest point in 25 years, they have been slightly worse than their peers in a context of broader global stock settlements.
JPMorgan and Bank of New York Mellon, which were also among the top of five sensitive banks discussed in the SAR, fell by more than 3% each during the New York negotiations.
Deutsche Bank’s shares, which handled the largest amount of SAR in the BuzzFeed case, fell more than 8% sometime on Monday morning after reports.
However, analysts downplayed the scale of problems.
“With a less extensive allegation of fact, we hope this article doesn’t have a lasting effect on industry or inventory prices,” Chris Kotowski, Oppenheimer analyst, wrote in a note.
Bank stocks were also stressed on Monday through news, adding considerations about the resurgence of coronavirus in Europe.
Deutsche Bank shares are collapsed: https://fingfx. thomsonreuters. com/gfx/mkt/jbyvrmkrepe/deutsche. PNG
IMPORTANT WORK
Deutsche Bank said the problems raised in the media reports were “historic,” while the German Ministry of Finance said Monday that cases similar to Germany’s had already been addressed in the reports.
HSBC also said that the data in the reports was historical, while Standard Chartered highlighted recent investments in its monitoring procedures.
BNY Mellon said it is in full compliance with “all applicable laws and regulations. “JPMorgan said he has “thousands of other people and heaps of millions of dollars true to this work. “
Many of the suspicious transactions were similar to those of corporations incorporated in Britain or the British offshore territories, leading action teams to demand stricter rules.
“If the government cares at all about the UK’s reputation in the world, it will have to avoid spreading the red carpet to criminals and corrupt people, and refusing to legitimize their cash through our companies and banks,” Global Witness said.
The UK government has said it is carrying out reforms to its business registration formula that will require business leaders more.
HSBC, Standard Chartered delays a wider European banking index this year: https://fingfx. thomsonreuters. com/gfx/mkt/ygdvzkdwdpw/Pasted symbol 1600691912490. png
LARGE WEALTH CENTERS
In recent years, global banks have increased their investments in the generation and body of workers to meet the most stringent regulatory needs in combating cash laundering and sanctions around the world.
Thousands of consumers have been evicted from bank accounts in primary wealth centers, adding Hong Kong and Singapore, following a laundering scandal in Malaysia, the disclosure of The Panama Papers and a global boost to fiscal transparency.
Compliance experts said the challenge component now is that banks had trouble distinguishing between transactions that were and were not suspicious, so they were only abandoning millions of queries that law enforcement agencies did not have the ability to process.
“Many banks are experiencing high rates of false positives and backlog (existing cases). That is why you see that the DAS were higher more than 100 days after the transaction,” said Cliff Lam, director of AlixPartners in Hong Kong.
(Reporting through Alun John, Sumeet Chatterjee and Donny Kwok in Hong Kong and Lawrence White, Ritvik Carvalho, Sujata Rao and Karin Strohecker in London, Pete Schroeder in Washington and Paritosh Bansal in New York; Edited through Raju Gopalakrishnan, Louise Heavens, Pravin Char and Jonathan Oatis)