The Financial Crimes Enforcement Network warned financial institutions about efforts by kleptocratic regimes and corrupt officials to launder their illicit profits, citing Russia as a particular concern.
The US Treasury Department’s Anti-Money Laundering Unit, in a briefing Thursday, urged banks and other financial institutions to focus their efforts on exposing proceeds of foreign public corruption that could potentially be laundered through shell companies, offshore financial centers and professional service providers . according to statement.
According to FinCEN, kleptocrats use their positions of power and influence to steal the public’s wealth for personal gain and enrich their networks of corrupt actors, eroding public trust and harming the most vulnerable in society. Public corruption abroad can also violate US law, the Foreign Corrupt Practices Act.
The US government has long expressed concern about Russia’s kleptocracy. Russia deserves special attention, FinCEN said, because the country serves as a “hub” for public corruption, sanctions evasion, money laundering and malicious activities abroad. As an example, FinCEN cited the recent invasion of the Kremlin in Ukraine, with many of Russia’s elites and oligarchs, who control much of Russia’s economic interests, supporting and enabling its actions there.
“Russia’s further incursion into Ukraine is yet another example of how a kleptocracy like Russia … harms not only its own citizens but also those living beyond its borders,” Himamauli Das, acting director of FinCEN, said in a statement. “Financial institutions play a critical role in identifying corrupt activity and related money laundering by foreign officials and should remain vigilant and promptly report suspicious financial activity.”
The guide, which offers potential red flags related to kleptocracy and other forms of foreign corruption, comes as President Biden identified fighting corruption as a core US national security issue.
As part of the effort, the Treasury Department last month launched the Kleptocracy Asset Recovery Rewards Program, which offers payments for tips leading to the seizure or loss of assets related to foreign government corruption, including those linked to the Russian government.
The recommendation also comes as the US ramps up pressure on Russian oligarchs. US and Spanish authorities earlier this month seized a $90 million superyacht in Spain that they said belongs to a sanctioned oligarch with close ties to Russian President Vladimir Putin, the first such seizure.
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https://www.wsj.com/articles/russian-kleptocrats-of-particular-concern-to-u-s-treasury-11649974520?mod=pls_whats_news_us_business_f Russian kleptocrats with particular concern for US Treasury