In the largest exposé on the financial system since 2016’s Panama Papers leak, 

 has obtained over 2,500 documents revealing the extent of corruption in the global banking system. Known as the ‘FinCEN Files’, the 2,657 documents include 2,121 suspicious activity reports, which banks send to authorities in order to raise concerns about just where some of their clients’ money might be coming from.

FinCEN is the US Financial Crimes Enforcement Network, a department of the US Treasury responsible for combating any financial crime involving US dollars, wherever it takes place the world. Should a bank be worried that one of its clients isn’t legitimate, or is engaged in illegal activities, it should send a suspicious activity report (SARs) to FinCEN.

The leaked files, which span the period between 2000 and 2017, cover roughly $2 trillion of transactions and are said to reveal how some of the world’s largest banks have enabled criminal enterprises to launder dirty money.

Usually these documents are a closely guarded secret, but a batch was leaked to 

 who shared them with the International Consortium of Investigative Journalists (ICIJ), which in turn shared them with over 108 news organisations in 88 countries. Speaking to the BBC, Fergus Shiel from ICIJ explained that the leaked files were an “insight into what banks know about the vast flows of dirty money across the globe”.

And, while the transactions may be in USD, the UK has a special role to play in the story. According to FinCEN the UK is a “higher risk jurisdiction” due to the overwhelming number of UK companies named in the files – over 3,000.

Some of the revelations that have come to light include Chelsea owner 

 previous ownership of secret investments in non-Chelsea footballers through an offshore company; JP Morgan allowing an unknown company whose owners may or may not be on the FBI’s Most Wanted list to move more than $1bn through a London account; and that the husband of a woman who has donated £1.7m to the Conservative Party was secretly funded by a Russian oligarch with ties to President Putin.

“Giants of Western banking move trillions of dollars in suspicious transactions, enriching themselves and their shareholders while facilitating the work of terrorists, kleptocrats, and drug kingpins,” write the 11 authors of the 

 exposé. “Profits from deadly drug wars, fortunes embezzled from developing countries, and hard-earned savings stolen in a Ponzi scheme were all allowed to flow into and out of these financial institutions, despite warnings from the banks’ own employees.”

Far from being a harmless, victimless crime, money laundering is serious business. “It is the very fuel of crime,” Martin Woods, former money laundering reporting officer told the BBC. “If we continue to launder money, criminals will continue to commit the crimes, to kill people over drugs, to supply drugs that kill people in our community…Banks or bankers for too long have seen it in the abstract and removed it from the crime. We need to join those dots up again.”

"Money laundering is a crime that makes other crimes possible."

For those not au fait with the gangster film genre, the principle of laundering money is simple. As a criminal organisation, you’ll earn vast sums of money, often in cash, from illegal activities. Laundering is the process of turning this money into ‘clean’, taxable money, often through a front organisation which will either be an entirely fictitious company, or one which can be made to look like it’s much more successful than it is. Think Walter White’s car wash in 

. Once the money is ‘clean’ it goes into a bank and, theoretically, can no longer be linked to crime.

Naturally, banks aren’t supposed to help clients do this. In fact, the law states that every bank must know exactly who its clients are. By law, it isn’t enough to just file SARs and pass the problem on, if a bank has evidence of criminal activity it should stop accepting cash from that client altogether. Once it has received SARs FinCEN makes them available to law enforcement agencies but it cannot force the banks to stop accepting the laundered money.

“Money laundering is a crime that makes other crimes possible. It can accelerate economic inequality, drain public funds, undermine democracy, and destabilise nations,” explains the 

 piece. The article also goes on to say that, in the few instances when the US government has cracked down on banks, it often brokers ‘sweetheart deals’ which include fines but no top-tier arrests.

“The Trump administration has made it even harder to hold executives personally accountable, under guidance by former deputy attorney general Rod Rosenstein that warned government agencies against ‘piling on’,” explains the article. Rosenstein’s response to the article was to argue that his policies sought to “encourage prosecutors to pursue charges against the people responsible for corporate wrongdoing.”

Presumably, then, Standard Chartered will be punished for moving cash for Arab Bank even after clients’ accounts were found to have been used for funding terrorism. One assumes Deutsche Bank will likewise be punished for moving money from organised crime, terrorists and drug traffickers. HSBC, meanwhile, allowed art fraudsters to move millions of stolen dollars even after it was supplied with information that its clients’ scheme was a scam.

Restrictions are also in place to prevent Russian oligarchs moving money into the west. Despite this, the leak found evidence that one of Vladimir Putin’s close associates used Barclays bank in London to avoid sanctions, using some of the cash to invest in art.

In fact, it seems that prior to the report, very little was actually done to penalise banks. As 

 reports: “The FinCEN Files investigation shows that even after they were prosecuted or fined for financial misconduct, banks such as JPMorgan Chase, HSBC, Standard Chartered, Deutsche Bank, and Bank of New York Mellon continued to move money for suspected criminals.”

The FinCEN revelations don’t just highlight the extent of corporate greed, and the shady ethics of the banking industry, crucially they demonstrate the need for rapid, actionable change in the way SARs are handled, and what penalties are put in place. Or perhaps that a different system is required altogether.

Responding to the leak, FinCEN argued that the release might now make banks less willing to file SARs reports which, it believes, “could mean law enforcement has fewer potential leads to stop crimes like human trafficking, child exploitation, fraud, corruption, terrorism, and cyber-enabled crime.”

"The FinCEN Files investigation shows that even after they were prosecuted or fined for financial misconduct, banks continued to move money for suspected criminals."

, Michael German, a former FBI agent who now specialises in national security and privacy called the concept of SARs “naive” because they rely on the banks to file them, and often money laundering occurs with the cooperation and knowledge of the very banks who are supposed to report suspicious activity – and also earn a fee for every transaction.

Many have called for change, with Democratic senator and member of the Senate Intelligence Committee Ron Wyden telling 

 that the leak “reinforces the fact that we now have two systems of law enforcement and justice in the country.”

Wyden and colleagues at the Senate Intelligence Committee have requested some of the leaked files, a reassuring first step in addressing this inherent corruption. Long-term, it has been suggested that companies be required to disclose their owners directly to the Treasury Department, instead of using shell companies to hide their tracks. US Lawmakers are currently debating a bipartisan bill addressing exactly this for small companies.

 piece argues – the simplest way to fix the problem might be to arrest those at fault. In 2020, putting CEOs in jail seems revolutionary, but as the article points out, the US government prosecuted CEOs throughout the 1980s, 1990s and in to the 2000s. Will the FinCEN leak see us taking this course again, or is there simply too much money at stake?

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