FinCEN Analysis Reveals Trends and Patterns in Suspicious Activity Potentially Tied to Evasion of Russia-Related Export Controls

The Financial Crimes Enforcement Network (FinCEN) has issued a financial trend analysis on „Trends in Bank Secrecy Act Data: Suspected Evasion of Russian Export Controls“ in Bank Secrecy Act reporting. Therein, FinCEN primarily outlines the findings from an analysis of suspicious activities reports (SARs) filed between June 2022 and July 2023 relating to suspicious transactions involving „suspected evasion of Russian export controls“, taking into account transactions reaching as far back as April 2016. The report thereby highlights common fund flow patterns which should help firms in their risk assessments and control setups to help prevent illicit actions and transactions in that regard.
##### The main findings of the analyzed data include the following:
– By far the most reports were filed by U.S.-based depository institutions with 333 reports, making up a total of 96% of all reports filed in this context.
– The remaining 4% of reports were submitted by financial holding companies, a securities and futures exchange, FinTechs, and money service providers.
– BSA reports suggest that intermediary firms in various nations seem to have procured or are procuring goods of U.S. origin on behalf of Russian recipients.
– BSA reports also indicate that firms in China, Hong Kong, and other jurisdictions may be supplying sensitive goods to Russia such as computer components, essential electronics, and even dual use goods.
– Most BSA reports involve firms linked to the electronics industry, e.g. involved in the production of radio frequency products.
– There are indications that „companies in the industrial machinery industry may also be potential suppliers of equipment to Russia“.
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For more detailed information, please refer to the enclosed report.