44 Indian Banks Listed in FinCEN Files

Published September 27th, 2020 - 01:30 GMT
44 Indian Banks Listed in FinCEN Files
Files released recently by US Department of Treasury's FinCEN, the Financial Crimes Investigation Network, revealed that major global banks have allowed criminals to move more than $2 trillion "dirty money" around the globe. (Shutterstock)
Highlights
Banks are required to file an SAR whenever handling funds that cause grounds for suspicion of criminal activity

Punjab National Bank, India's second largest public sector bank, heads the list of over 40 Indian banks that have been reportedly involved in $ I billion worth of transactions of suspicious activity reports (SAR) filed by US banks with the monitoring agency, the Financial Crimes Enforcement Network (FinCEN).

Files released recently by US Department of Treasury's FinCEN, the Financial Crimes Investigation Network, revealed that major global banks have allowed criminals to move more than $2 trillion "dirty money" around the globe.

The revelation has sent jitters across the financial world, triggering tailspin crashes in shares of several global banking giants, including HSBC Holdings, Standard Chartered, Barclays, Deutsche Bank, Commerzbank, JPMorgan Chase & Co and Bank of New York Mellon Cor.

Data obtained by the International Consortium of Investigative Journalism (ICIJ) from SARs filed by American banks reveal that 44 Indian banks - public, private and foreign - were flagged for these transactions. These could relate to activities such as money laundering, terrorism and drugs. Banks are required to file an SAR whenever handling funds that cause grounds for suspicion of criminal activity.

The ICIJ investigation revealed that over an 18-year period, banks moved over $2 trillion globally, which they believed were suspicious. ICIJ said the SARs only describe potential illegal activity and are not considered to be, and do not purport to be, proof of any violation of the law.

Documents show that Indian banks are listed in SAR related to over 2,000 transactions valued at over $1 billion between 2011 and 2017. These include several hundred transactions related to Indian entities and businessmen where the Indian shippers or recipients have addresses in foreign jurisdictions.

The documents show that r Indian banks mentioned in the SARs include the Punjab National Bank, which is state owned (290 transactions); State Bank of India (102); Bank of Baroda (93); Union Bank of India (99) and Canara Bank (190), among others.

Among the private banks listed in SAR are HDFC Bank (253 transactions); ICICI Bank (57); Kotak Mahindra Bank (268); Axis Bank (41) and IndusInd Bank (117) among others.

Indian banks figure in the SARs primarily because they are "correspondent banks" to the foreign banks which have filed these SARs and figure in the network through which these transactions have been effected, a banking analyst said.


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