Donald Trump’s former campaign manager Paul Manafort sentenced to 47 months in prison on five counts of tax fraud, one count of hiding his foreign bank accounts and two counts of bank fraud, far below the minimum sentencing guidelines of 19 to 24 years. “I think the sentencing range is excessive,” U.S. District Judge T.S. …
Tag: Money Laundering
Mar 07 2019
May 09 2018
Tuesday evening, the lawyer for porn star Stormy Daniels, Michael Avenatti dropped a bombshell revealing that Donald Trump’s attorney Michael Cohen received $500,000 from Russia oligarch Viktor Vekselberg after the 2016 presidential election. The story was corroborated by The New York Times and The Washington Post Today it was reported that there were also payments …
Mar 07 2018
Back in January 2017, Erik Prince, the founder of Blackwater and an informal adviser to Mr. Trump’s team during the presidential transition, had a clandestine meeting in the Seychelles with Crown Prince Mohammed bin Zayed Al-Nahyan, the ruler of the United Arab Emerites (UAE). It was revealed in April that the purpose of that meeting …
Jan 19 2018
Early on in a story by McClatchy reporters, Peter Stone and Greg Gordon, it was revealed that the FBI was investigating whether Russian money went to the National Rifle Association to help the Trump campaign, The FBI is investigating whether a top Russian banker with ties to the Kremlin illegally funneled money to the National …
Dec 06 2017
It was reported yesterday that Special Counsel Robert Mueller had subpoenaed the bank records of the Trump family from Deutsche Bank. Duetsche Bank has a rather dubious history of laundering money for everyone from drug lords to arms dealers to oligarchs. Just this psst January, the bank was fined $620 million for its part in …
Dec 05 2017
The Special Counsel Robert Mueller is moving right along. Former Trump campaign manager Paul Maanfort had come to a bail deal that acceptable to the court and Mueller’s office. Problem is that these guys have such huge egos they think they can flout the rules: Former Donald Trump campaign chairman Paul Manafort was, as recently …
Aug 31 2017
Last night Politico reported Special Counsel Robert Mueller has teamed up with New York State Attorney General Eric Schneiderman on the case of former Trump campaign manager Paul Manafort. Part of the reason for the duel investigation is the possibility that Trump will pardon Manafort and others of federal charges involving the Trump campaign’s conspiring …
Jul 21 2017
In his interview with New York Times reporters Peter Baker, Michael S. Schmidt and Maggie Haberman Donald Trump said that Special Counsel Robert Mueller investigating his family’s finances would be a “red line.” SCHMIDT: Last thing, if Mueller was looking at your finances and your family finances, unrelated to Russia — is that a red …
May 12 2017
More and more the Russian investigation is becoming about the money. Senator Ron Wyden (D-OR), member of the Senate Finance and Intelligence Committees, spoke with MSNBC’s Rachel Maddow about why he thinks the Trump-Russia investigation should focus on Donald Trump’s business ties. From Steve Benen at Maddow Blog: In his interview yesterday with …
Mar 13 2013
Once again Sen. Elizabeth Warren demonstrated why the voters of Massachusetts sent her to the Senate when in a Senate Banking Committee hearing about money laundering, she questioned why British bank HSBC is still doing business in the U.S., with no criminal charges filed against it, despite confessing to what one regulator called “egregious” money laundering violations
Her comments came just a day after the attorney general of the United States confessed that some banks are so big and important that they are essentially above the law. His Justice Department’s failure to bring any criminal charges against HSBC or its employees is Exhibit A of that problem.
(..} Warren grilled officials from the Treasury Department, Federal Reserve and Office of the Comptroller of the Currency about why HSBC, which recently paid $1.9 billion to settle money laundering charges, wasn’t criminally prosecuted and shut down in the U.S. Nor were any individuals from HSBC charged with any crimes, despite the bank confessing to laundering billions of dollars for Mexican drug cartels and rogue regimes like Iran and Libya over several years.
Defenders of the Justice Department say that a criminal conviction could have been a death penalty for the bank, causing widespread damage to the economy. Warren wanted to know why the death penalty wasn’t warranted in this case.
“They did it over and over and over again across a period of years. And they were caught doing it, warned not to do it and kept right on doing it, and evidently making profits doing it,”
“How many billions of dollars do you have to launder for drug lords and how many economic sanctions do you have to violate before someone will consider shutting down a financial institution like this?”
“You sit in Treasury and you try to enforce these laws, and I’ve read all of your testimony and you tell me how vigorously you want to enforce these laws, but you have no opinion on when it is that a bank should be shut down for money laundering?”
“If you’re caught with an ounce of cocaine, the chances are good you’re gonna go to jail. If it happens repeatedly, you may go to jail for the rest of your life,” Warren said. “But evidently if you launder nearly a billion dollars for drug cartels and violate our international sanctions, your company pays a fine and you go home and sleep in your bed at night — every single individual associated with this. And I think that’s fundamentally wrong.”
As staunch an opponent of the death penalty as I am, I would have voted for it and watched the “execution” of HSBC with glee.
Dec 19 2012
Last summer it was revealed that one of the world’s largest banks based, HSBC, base in Britain, had been laundering billions of dollars for Mexican drug cartels and skirting US government bans against financial transactions with Iran and other countries that aid Al Qaeda and other terrorist groups. In a stunning move during a hearing before the Senate Permanent Subcommittee on Investigations chief compliance officer, David Bagley, took the blame and resigned.
Last week the federal government and New York State announced a settlement with HSBC:
In a filing in Federal District Court in Brooklyn, federal prosecutors said the bank had agreed to enter into a deferred prosecution agreement and to forfeit $1.25 billion. The four-count criminal information filed in the court charged HSBC with failure to maintain an effective anti-money laundering program, to conduct due diligence on its foreign correspondent affiliates, and for violating sanctions and the Trading With the Enemy Act.
“HSBC is being held accountable for stunning failures of oversight – and worse – that led the bank to permit narcotics traffickers and others to launder hundreds of millions of dollars through HSBC subsidiaries, and to facilitate hundreds of millions more in transactions with sanctioned countries,” Lanny A. Breuer, the head of the Justice Department’s criminal division, said in a statement. [..]
HSBC, based in Britain, has also agreed to pay the Office of the Comptroller of the Currency, one of the bank’s central regulators, an additional $500 million as part of a civil penalty. The Federal Reserve will be paid a $165 million civil penalty. [..]
HSBC also entered into a deferred prosecution agreement with the Manhattan district attorney’s office. As part of that agreement, HSBC admitted that it violated New York State law.
Just like the mortgage and banking fraud that was uncovered during the financial crisis, there will be no criminal charges. The fines that were levied are tantamount to about five weeks of income for the bank. Contributing editor for the Rolling Stone, Matt Taibbi points out the outrageous incongruity of this settlement:
If you’ve ever been arrested on a drug charge, if you’ve ever spent even a day in jail for having a stem of marijuana in your pocket or “drug paraphernalia” in your gym bag, Assistant Attorney General and longtime Bill Clinton pal Lanny Breuer has a message for you: Bite me. [..]
The banks’ laundering transactions were so brazen that the NSA probably could have spotted them from space. Breuer admitted that drug dealers would sometimes come to HSBC’s Mexican branches and “deposit hundreds of thousands of dollars in cash, in a single day, into a single account, using boxes designed to fit the precise dimensions of the teller windows.”
This bears repeating: in order to more efficiently move as much illegal money as possible into the “legitimate” banking institution HSBC, drug dealers specifically designed boxes to fit through the bank’s teller windows. [..]
Though this was not stated explicitly, the government’s rationale in not pursuing criminal prosecutions against the bank was apparently rooted in concerns that putting executives from a “systemically important institution” in jail for drug laundering would threaten the stability of the financial system. The New York Times put it this way:
Federal and state authorities have chosen not to indict HSBC, the London-based bank, on charges of vast and prolonged money laundering, for fear that criminal prosecution would topple the bank and, in the process, endanger the financial system. [..]
So there is absolutely no reason they couldn’t all face criminal penalties. That they are not being prosecuted is cowardice and pure corruption, nothing else. And by approving this settlement, Breuer removed the government’s moral authority to prosecute anyone for any other drug offense. Not that most people didn’t already know that the drug war is a joke, but this makes it official.
Apparently this settlement has garnered some bipartisan concerns from Senators Jeff Merkley (D-OR) and Charles Grassley. In separate statements released from their offices, they criticized the Justice Department for not sending a stronger message to the banking industry. Sen. Grassley said it best:
The Department has not prosecuted a single employee of HSBC-no executives, no directors, no AML compliance staff members, no one. By allowing these individuals to walk away without any real punishment, the Department is declaring that crime actually does pay. Functionally, HSBC has quite literally purchased a get-out-of-jail-free card for its employees for the price of $1.92 billion dollars.
There is no doubt that the Department has “missed a rare chance to send an unmistakable signal about the threat posed by financial institutions willing to assist drug lords and terror groups in moving their money.” One international banking expert went as far as to argue that, despite the “astonishing amount of criminal behavior” from HSBC employees, the DPA is no more than a “parking ticket.”
But, as David Dayen at FDL News notes there are crickets from certain key senators:
Matt Stoller makes a very good point here: where is Patrick Leahy on this? He has made no public statement on the HSBC case, despite being the co-author of the Fraud Enforcement and Recovery Act, which was supposed to deliver funds toward prosecuting fraudulent big bank activity (it never actually did). Grassley, a co-author, has spoken out. Why not Leahy?
Transcript can be read here
Now, not only are the banks “too big to fail“, they are “too big to jail.”
Aug 17 2012
No agreement is perfect but the settlement that was reached Tuesday afternoon with the New York Department of Financial Services over Standard Charter Bank’s illicit money laundering with Iran and other countries under sanctions was better than most. In particular, SBC’s admission that the “the conduct at issue involved transactions of at least $250 billion.” The fine of $340 million was larger than the $250 million SBC offered but smaller than either the $700 million to $1 billion that SBC might have had to pay if the case had gone to a hearing on Wednesday and large because of the multi-billion dollar transaction admission. So the agreement is being touted as a victory for Benjamin M. Lawsky and his 10-month old agency, the New York Department of Financial Services which took on the bank without the Federal agencies who have been negotiating with SBC.
STATEMENT FROM BENJAMIN M. LAWSKY, SUPERINTENDENT OF FINANCIAL SERVICES, REGARDING STANDARD CHARTERED BANK
Benjamin M. Lawsky, New York Superintendent of Financial Services, issued the following statement today.
“The New York State Department of Financial Services (“DFS”) and Standard Chartered Bank (“Bank”) have reached an agreement to settle the matters raised in the DFS Order dated August 6, 2012. The parties have agreed that the conduct at issue involved transactions of at least $250 billion.
“The settlement also includes the following terms:
- The Bank shall pay a civil penalty of $340 million to the New York State Department of Financial Services.
- The Bank shall install a monitor for a term of at least two years who will report directly to DFS and who will evaluate the money-laundering risk controls in the New York branch and implementation of appropriate corrective measures. In addition, DFS examiners shall be placed on site at the Bank.
- The Bank shall permanently install personnel within its New York branch to oversee and audit any offshore money-laundering due diligence and monitoring undertaken by the Bank.
“The hearing scheduled for August 15, 2012 is adjourned.
“We will continue to work with our federal and state partners on this matter.”
This settlement is only with the New York regulator and it includes the transfers with Libya, Mynmar and the Sudan.
While this could have been better, Mr. Lawsky did get the bank to concede that the transfer did indeed involve the $250 billion which resulted in a larger settlement. SBC still must deal with the federal regulators based on the concession with NYDF. As David Dayen at FDL sees it this put a whole new slant on those talks:
In addition, this does not end the legal trouble for Standard Chartered. This only resolves the issues with the New York Department of Financial Services. Federal regulators (including Treasury, the Federal Reserve and the Justice Department) as well as the Manhattan District Attorney must now enter into their negotiations, and if they cannot get as much as the DFS, it will be completely embarrassing. This could cost Standard Chartered at least double this initial figure.
Meanwhile over at the SEC, Wells Fargo walks away from mortgage investment case with a $6.5 million fine and no admission of wrongdoing as usual. Wells Fargo earned $16 billion last year.
The Securities and Exchange Commission has spent nearly four years building cases against the nation’s biggest banks for their role in the mortgage mess.The agency has filed civil actions against Goldman Sachs, JPMorgan Chase and Citigroup.
But in recent months, the agency has struggled to bring big cases as it pursued a second round of investigations focused on the banks’ failure to disclose the dangers of mortgage securities. The Wells Fargo case comes just days after Goldman Sachs revealed that the S.E.C. had closed an investigation into a 2006 mortgage deal without pursuing charges. [..]
The action also cited Shawn McMurtry, a former vice president and broker at the bank, over his role in selling the deals. Under the settlement, Mr. McMurtry agreed to a $25,000 fine and six-month suspension from the securities industry.
I’m sure Mr. McMurtry can afford it.