Suspicious transaction reports expose cracks in bank AML frameworks

A Buzzfeed investigation on more than 2,100 suspicious activity reports banks filed with the U.S. Treasury Department’s Financial Crimes Enforcement Network reveals that over a period of nearly two decades, major institutions moved trillions of dollars for suspected terrorists, drug dealers, and corrupt foreign government officials.

Why should we care?
From 1999 to 2017, more than $2T in bank transactions were flagged for suspected money laundering or other criminal activity, Buzzfeed reported. The top two banks were Deutsche Bank, which flagged $1.3T in suspicious transactions; and JPMorgan, which identified $514B. Banks mentioned in the report acknowledged that work needs to be done, and pointed to improvements in tracking and combating financial crimes. Deutsche Bank added that suspicious activity reports are “alerts of potential issues and not proven facts,” while JPMorgan highlighted its proactive efforts. Analysts suggest the problem is bigger than banks’ individual failures. “Perhaps what we’re about to witness suggests systemic failures across the entire financial system," said Rachel Wooley, global director of financial crime at regtech firm Fenergo.