London, United Kingdom | AFP | Several British banks processed nearly $740 million in a multi-billion dollar Russian money-laundering scam, The Guardian newspaper said on Monday.
According to documents obtained by the Organized Crime and Corruption Reporting Project, at least $20 billion was moved out of Russia between 2010 and 2014 in a vast criminal operation called “The Global Laundromat”, the paper said.
The scam involved more than 500 people including oligarchs and Russian criminals with links to the government and the domestic intelligence agency, the FSB, it said.
Over that period, British banks including HSBC, Royal Bank of Scotland (RBS), Barclays and Coutts reportedly handled over 1,900 transactions — out of 70,000 — worth nearly $740 million , according to the Guardian.
A further 373 operations are believed to have gone through US banks, for a total amount of $63 million.
Britain’s National Crime Agency (NCA) said it was “willing to consider any formal request for assistance” in connection with the investigation.
However, it added that while the Laundromat scheme involved companies established in Britain, their bank accounts were held in non-UK jurisdictions so the money did not generally move through its financial system.
“The launderers exploit the distance and legal barriers between the two (jurisdictions), whilst being able to control both the company and the bank accounts either directly or indirectly,” NCA said in a statement issued to AFP.
A Barclays bank spokesman stressed that the lender “complies with the rules and regulations in all the jurisdictions in which it operates and has systems and controls in place to mitigate the risk of the bank being used to facilitate financial crime”.
HSBC responded to the allegations saying: “The bank has systems and processes in place to identify suspicious activity and report it to the appropriate government authorities.
“This case highlights the need for greater information sharing between the public and private sectors, each of whom holds important information the other does not.”
RBS said it was “committed to combating financial crime and money laundering in line with our regulations and have controls and safeguards in place to identify, assess, monitor and mitigate these risks.”
The Guardian said that while all major British banks will face questions over why they did not raise the alarm on suspicious money transfers, they actually only processed money that had already been laundered.
American banks, including CitiBank and Bank of America, are the only ones that raise money-laundering concerns, the paper added.