FinCEN: How Turkey’s Aktif Bank helped Wirecard and the porn industry
Turkish companies and banks pop up frequently and prominently in the FinCEN Files, a collection of secret documents from the US Department of the Treasury that was leaked to BuzzFeed News and shared with the International Consortium of Investigative Journalists (ICIJ). The files from the Financial Crimes Enforcement Network (FinCEN), a regulatory unit of the US Department of the Treasury, provide insight into suspicious money transactions.
Among the businesses included in the documents, one, in
particular, stands out: Aktif Yatirim Bankasi, or Aktif Bank.
It is suspected of having carried out money laundering on a
grand scale for a customer network that includes the scandal-ridden German
financial service provider Wirecard and shady figures from the porn industry.
Aktif Bank is part of Calik Holding, one of the largest
groups in Turkey, to which more than 30 companies belong. Calik, in turn, has
close ties with the Turkish government. A number of "suspicious
transactions" included in the FinCEN Files were made while Berat Albayrak
was CEO of Calik Holding. Albayrak is the son-in-law of Turkish President Recep
Tayyip Erdogan and is currently Turkey's Finance Minister.
The incriminating evidence against Aktif comes from
Suspicious Activity Reports (SARs). These are records banks themselves file
with FinCEN when they suspect possible violations of financial regulations.
Financial institutions conducting business in the US, such
as Aktif Bank, are required to submit SARs. SARs reflect the concerns of
compliance officers in financial institutions and do not necessarily prove
criminal activity or other misconduct.
Some 400 journalists from 88 countries spent 16 months
scrutinizing the leaked FinCEN documents. The result: a view into the
previously murky paths of international financial transactions. The ICIJ
investigation suggests that with the help of Aktif Bank, dirty money was also
pumped back into the market.
The FinCEN files contain warning messages from the Bank of
New York Mellon (BNY Mellon) and Bank of America (BoA), both of which were or
are active as correspondent banks for Aktif's international business.
According to the FinCEN Files, between June 6, 2013, and
July 1, 2014, Aktif Bank processed suspicious transactions worth some $91.6
million (€77.3 million) through its partners in the United States.
Moreover, the documents shed light on the Turkish bank's
dubious customer network, including providers of pornography and a company that
is suspected of having business relationships with the radical Islamic Taliban.
Financial facilitator for Wirecard
Lately, one name on Aktif's client list has been making a
lot of headlines. Germany's Wirecard Bank AG, which is currently involved in a
multi-million-dollar fraud scandal, was among the clients Aktif Bank referred
to its correspondent bank BNY Mellon. But the New York creditor flagged
Wirecard Bank transactions as "high-risk" and froze its accounts.
That didn't stop Aktif Bank from helping Wirecard. The
FinCEN Files indicate that Aktif transferred the money to BNY Mellon under an
undisclosed name. According to the US bank, Wirecard made as many as 12
"suspicious transactions" worth more than $110,000 (€93,000) through
its Aktif Bank account between May and July of 2014.
Wirecard conducted a good deal of business with customers
from the pornography and gambling industries. According to information
contained in the FinCEN Files, Aktif Bank facilitated much of that business. As
early as December 2013, BNY Mellon reported "suspicious transfers"
with a volume of around $17.5 million (€14.7 million). Most of these came from
big names in the adult industry, including MindGeek, owners of Pornhub and
Youporn. Until 2013, MindGeek was known as Manwin and is recorded as Manwin in
the documents.
Many roads lead to Afghanistan
The names of Aktif Bank customers with links to Afghanistan
appears equally as perplexing. Between May 27 and July 1, 2014, Aktif Bank
orchestrated exactly 561 "suspicious" money transfers worth $35.3
million (€29.8 million) from Afghan accounts. With no public information
available on the companies or their actual business, the Afghan entities were
suspected of being shell companies, which suggests money laundering.
Aktif Bank's list of Afghan customers doesn't end there. The
New Kabul Bank — a financial institution that was mired in a billion-dollar
corruption scandal in 2010 before it reinvented itself a year later under its
current name — also maintains a customer account. Corruption is rampant in
desperately poor Afghanistan and BNY Mellon marked several New Kabul Bank
transactions forwarded by Aktif Bank as "suspicious."
Bank of America (BoA) also filed a Suspicious Activity
Report to the US Department of the Treasury with regards to Aktif Bank's
Afghanistan connection. In this case, it was conspicuous transactions that the
Turkish bank initiated on behalf of the Afghan company Watan Oil and Gas.
Particularly questionable are money transfers of $3.6 million (€3.04 million)
between June 2013 and March 2014. According to the US bank's own statements,
which are documented in the FinCEN Files, BoA has since ceased its activities
as a correspondent bank for Aktif Bank because the Watan Group is accused by
the US government of maintaining relations with the radical Islamic Taliban.
The US government blacklisted the Watan Group after its own
investigations into the Afghan subsidiary Watan Risk Assessment. The
investigation revealed that the Watan subsidiary had paid the Taliban several
million dollars in return for protecting their convoys. Sanctions against the
Taliban have been in place since the terrorist attacks of September 11. All of
this happened at a time when US troops were still actively fighting the
Taliban.
BoA itself noted in a SAR that the bank's payment
surveillance team detected potentially unusual transfers of mostly large
rounded dollar amounts. They were sent from a customer of Aktif Bank on behalf
of Watan Gas and Oil and processed through several banks.
The BoA wrote verbatim in its SAR: "The wires sent from
Watan Gas via Aktif Bank remitted to two Latvian banks in Riga and the business
entities receiving funds seem to be shell companies located in British Virgin
Islands and Hong Kong."
According to the US bank's own assessment: "There is a
geographic disconnect with banks in Latvia and beneficiaries. Afghanistan,
Turkey and Latvia are considered high-risk countries vulnerable to money
laundering and other illegal activities."
Aktif Bank has said it does not intend to directly comment
on the FinCEN Files. It did, however, say that filing a SAR alone does not
necessarily mean the transactions in question were prohibited or illegal. The
bank pointed out that it operates according to the guidelines put in place by
MASAK, Turkey's financial crimes investigator.
Furthermore, Aktif Bank says it is required to know exactly
who its customers are and whether they have ever been on national or
international sanctions lists, or whether financial institutions, for instance,
had ever been involved in money laundering or terror financing in the
past.
Aktif Bank says it undergoes annual performance reviews by
its correspondent banking partners and that it does not conduct transactions
for the purpose of money laundering. The bank also said that its core values
prohibit it from doing business with companies from the pornography or gambling
industries.
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