Cyprus, long used has a place for Russian Oligarchs and leaders to hide billions of dollars, is now seeing an intense investigation and exposure of complicity of several Cypriot financial services firms aiding oligarchs in hiding their moneys in Cyprus banks. Cypriot investigators held a meeting this week without the U.S. group to assess the progress — and next steps — in at least 30 cases of suspected sanctions violations, according to the Phileleftheros newspaper. Among those under investigation is Russian billionaire Alexey Mordashov, whose push to shield a $1.4 billion investment from EU sanctions was revealed by ICIJ.
Cyprus recently called in a team from the United States as it scrambles to contain the fallout from ICIJ’s Cyprus investigation . A team of two dozen U.S. financial crime experts from the Federal Bureau of Investigation and the Treasury Department has reportedly touched down on the Mediterranean island. They’re expected to help with the Cypriot government’s probe into sanctions dodging by Russian oligarchs, who have long used Cyprus as a hideaway for billions of dollars of assets. Cyprus Confidential exposed the complicity of several Cypriot financial services firms in helping the Russian elite move and hide money.
Persons with specific information about financial services firms that are assisting Russian Oligarchs may bring a whistleblower case under FINCEN’s whistleblower program.
Financial Crime Enforcement Network (FinCEN) has a relatively new program which provides financial rewards, anonymity, and confidentiality to those who reveal information.
Congress amended the whistleblower program for the Bank Secrecy Act (BSA) . The newly expanded program allows anyone to come forward with information related to violations of the BSA, and provides a mandatory financial award for whistleblowers who bring forward information about a financial institution violating compliance rules.
Treasury Whistleblower Program to cover tips relating to the evasion of sanctions in violation of the International Emergency Economic Powers Act, the Foreign Narcotics Kingpin Designation Act, and sections 5 and 12 of the Trading with the Enemy Act. In other words, whistleblowers can now report a wide range of sanctions violations to the government and, if successful, obtain an award.
This provision was made to assist with the government’s ongoing crackdown on Russian sanctions evaders. It is not just focused on Russian assets and those facilitating sanctions evasion for Russian oligarchs and entities. The program covers all violations of the operative anti-money laundering and sanctions laws. For example, given the federal government’s recent full court press on bad actors in the cryptocurrency space, provides yet another tool for whistleblowers in that industry (beyond the SEC and CFTC whistleblower programs) – an industry which has been afflicted by notoriously lax anti-money laundering controls.
JEFFREY NEWMAN IS THE SERNIOR PARTNER OF JEFF NEWMAN LAW. www.jeffNewmanlaw.com 617-823-3217
