Bank of New York Suit Over Inkombank Reinstated by U.S. Court
By David Glovin Jan. 14, 2002 (Bloomberg) New York, Jan. 14 (Bloomberg) -- A federal appeals court revived a lawsuit accusing Bank of New York Co. executives of looting assets from Inkombank, a now-defunct Russian bank. The suit by Inkombank depositors claims that bank executives, Russian mobsters and a few Bank of New York employees systematically transferred money through the New York-based bank and caused the Russian bank to fail.

Bank of New York former exec settles lawsuit against BoNY, will testify against BoNY opponents as part of agreement

Moscow sources say that the Bank of New York and its former senior vice president, Kagalovsky, settled her lawsuit against the Bank of New York and that BoNY agreed to allow Kagalovsky to exercise millions of dollars in stock options. According to sources, she will also get an undisclosed amount from confidential offshore accounts. However there is a catch: in exchange for the generous settlement Kagalovsky has agreed to testify on BoNY’s behalf in a lawsuit brought by BoNY shareholders in New York Federal Court. By letter dated November 6, 2001, BoNY lawyer, Richard Klapper of Sullivan & Cromwell informed all lawyers involved in the federal lawsuit that “as part of an agreement entered into last week between the Bank of New York Co., Inc. (“BNY”) and Natasha Gurfinkel Kagalovsky, Ms. Kagalovsky has agreed to make herself available for deposition [in the federal lawsuit.]”

Huge obstacles in global search for terrorist paper trail.
By RICHARD WOLFFE IN WASHINGTON AND JIMMY BURNS IN LONDON.
 
09/24/2001 Financial Times - FT.com ... according to the Bankers' Almanac, the banking industry directory, several established banks even have correspondent relationships with the Afghan central bank, in spite of the pariah status of the Taliban regime. Da Afghanistan Bank, which also performs commercial bank functions through branches across the country, has correspondent relationships with Bank of New York   ...

Cleaning up
 
09/21/2001 Financial Times - FT.com Tracking down the financial networks that support terrorists such as Osama bin Laden will be further complicated by the fact that - unlike with crime - much of the money is legitimate in origin. The pursuit of criminal money-launderers has made great strides over the past decade, but the armoury of weapons available to investigators trying to block the movement of terrorist funds remains incomplete.... A US Senate sub-committee report in 1999 criticised Citibank, part of Citigroup, the financial services company, for its role in handling huge sums of money for Raul Salinas, brother of a former Mexican president. Earlier that year, Bank of New York was found to have handled more than $7bn of suspect Russian funds.

A Stain on Mr. Clean. How a money-laundering indictment in Europe could haunt Putin.

A NEWSWEEK investigation By Mark Hosenball and Christian Caryl NEWSWEEK 09/03/2001. Vladimir Putin was on the advisory board of SPAG, suspected by intelligence officials to be linked to the laundering operations of Russian mobsters and Colombian drug dealers.

U.S. senators seek crackdown on money laundering

WASHINGTON, Aug 3 (Reuters) - A bipartisan group of senators on Friday introduced legislation to try to crack down on money laundering by corrupt foreign officials and stem the growing flow of dirty cash into the U.S. financial system. ... Earlier this year, the panel cited major U.S. banks, including Citibank, Bank of America , Chase Manhattan and Bank of New York, for being too quick to open accounts for offshore banks, too lax in monitoring them and too slow to close them down when problems became apparent.

New York, July 27 (MT~NewsWire).NEW YORK - Thomas Renyi , Bank of New York Co. chairman , who is fighting a federal lawsuit claiming he profited from a US$7- billion money-laundering scheme, was cleared of wrongdoing in an internal bank investigation, Bloomberg reported yesterday. But troubling questions persist regarding the bona fides of the internal inquiry conducted by by a so-called "special litigation committee" (SLC), comprised of BoNY directors under the guidance of a Washington law firm of Venable, Baetjer, Howard & Civiletti.

U.S. Trust Will Pay $10-Million Penalty Banking.

07/14/2001 Los Angeles Times LIZ PULLIAM WESTON U.S. Trust Corp., the blue-blood investment firm owned by Charles Schwab Corp., agreed to pay a $10-million penalty to regulators for allegedly violating rules designed to prevent money laundering and other fraud.... ... New York in recent years has increased its scrutiny of banks and other financial institutions in the wake of federal regulators' allegations that Bank of New York and other institutions laundered money for criminals.

Russia given deadline for money laundering fight: Canada supports sanctions after Sept. 30

06/23/2001, National Post  ... Russian mobsters, many with close ties to the government, have worked money- laundering scams for the past decade by funneling profits from drug-trafficking, prostitution and corruption into Western banks so they can make the money appear "clean." ... A series of financial scandals in the 1990s involving the alleged money laundering by Russians of billions of dollars through the Bank of New York implicated several leading figures.

Russia sees "unpleasant signal" on cash laundering

By Julie Tolkacheva, 06/22/2001, Reuters English News Service. Russia said on Friday it had received an "unpleasant signal" from an international agency which leads a war against money laundering after being threatened by sanctions and kept on a blacklist. ... Russia and money laundering have often been mentioned in tandem in recent years, especially after allegations billions of dollars of criminal funds were sent via the Bank of New York .

U.S. Clamps Down on Money Laundering

WASHINGTON (AP) - The United States and its economic allies are giving Russia and the Philippines until Sept. 30 to crack down on money laundering or face sanctions that could crimp future business.

Major money laundering trial opens in Moscow

06/08/2001 BBC Monitoring Moscow City Court has begun hearing one of the most high-profile criminal cases connected with money laundering. Many major foreign banks, including the Bank of New York , served as middlemen in transferring the money abroad. For instance, in the period from October 1997 through March 1998 around 50m dollars was transferred from Russia via the Bank of New York .

Bush Reviews Money Laundering Rules

By THE ASSOCIATED PRESS June 7, 2001WASHINGTON (AP) -- The Bush administration is reviewing rules designed to fight money laundering, saying they may be burdensome for U.S. banks without achieving their goal.... ... Combating laundering of illicit money became a major priority in the Clinton administration, particularly after revelations in 1999 that the Bank of New York, one of the nation's largest, had served as a conduit for $7 billion in Russian money -- some of it believed to be from criminal activity.

U.N. wants Russian help in $3 trillion crime fight

06/05/2001  (Reuters) - A top United Nations official said on Tuesday that up to $3 trillion in criminal cash washed through the world banking system each year, and urged Russia to speed up measures to fight it. ... Russia's international reputation has been sullied by financial scandals ranging from alleged laundering by Russians of billions of dollars through the Bank of New York to more recent charges against former Kremlin aide Pavel Borodin. 

Putin hosts talks aimed at cleaning up money trade: Russia is both victim and perpetrator of illicit industry

Bernard Besserglik 06/04/2001 National Post   ST. PETERSBURG - Vladimir Putin, the Russian President, will open an international conference on money laundering tomorrow aiming to crack down on a global industry in which Russia is both a leading player and principal casualty. ... A series of financial scandals in the 1990s involving the alleged money laundering by Russians of billions of dollars through the Bank of New York implicated several leading figures, and this year a former Kremlin aide, Pavel Borodin, was charged with the same offence by Swiss prosecutors.

Bank of New York Lawyers Subpoena Reporter’s Bank Records

May 18, New York (MT~Newswire)   Last week BoNY lawyers served subpoenae on banks demanding account statements and credit card records of Maria Berdnikova, a reporter who covers the Bank of New York - Russian money laundering scandal for various print and broadcast media, including the MT.

Has Dirty Money Polluted BNY?

Kelly Patricia O'Meara 05/07/2001 Insight Magazine Last year Thomas Renyi , chairman of the board and chief executive officer (CEO) of the Bank of New York (BNY) received more than $20 million in salary and other compensation for his management of the nation's oldest financial institution. This represents a more than 50 percent increase from what Renyi received in 1999 - the year in which he was called to testify before the House Banking and Financial Services Committee regarding allegations that BNY was involved in laundering at least $7 billion from what law-enforcement officials have described as dubious financial institutions and other entities in the former Soviet Union.

Inkombank Former Management May End Up Behind Bars

05/08/2001(MT~Newswire) Inkombank's insolvency was premeditated said Rosbank president Michael Prokhorov testifying before the Russian Parliament's (Duma) Committee on Bankruptcy and Restructuring of Credit Institutions. Prokhorov heads Inkombank's creditors committee. According to Prokhorov, Inkombank's management removed from the bank's balance and secreted approximately US$ 1 billion.

A Clear and Present Danger

Australian Broadcasting Corporation. Four Corners. Broadcast: 14/05/01.   It's been called the greatest theft ever. In the past decade between $200 billion and $500 billion has been gouged from the Russian economy

Iron curtain

Outlook; Washington Whispers. 04/30/2001 U.S. News & World Report Remember the Bank of New York money- laundering scandal, with allegations of $7 billion in Russian mob money landing in U.S. accounts? After nearly two years, the probe has stalled. Why? Because the Kremlin won't help, FBI brass say. Despite being led by the hand, Russian G-men have failed to find a criminal link to a single ruble out of 280,000 suspect transactions from three banks under investigation.

Russia finally joins world pact against dirty cash

By Daniel Mclaughlin 04/25/2001 Reuters English News Service (C) Reuters Limited 2001. MOSCOW, April 25 (Reuters) - Russia finally ratified a global treaty on money laundering on Wednesday, a decade after its creation and under Western pressure to clean up the banking sector and escape a blacklist of financially murky nations. ... ... Financial scandals battered Russia's reputation in the late 1990s, ranging from alleged laundering by Russians of billions of dollars through the Bank of New York , to more recent charges against President Boris Yeltsin's former aide Pavel Borodin. ...

Barclays drawn into Russian metals lawsuit

04/22/2001 Sunday Times - London News International BARCLAYS BANK could be drawn into a multi-billion-pound legal action in America involving some of Russia's most powerful businessmen and accusations ranging from murder to money laundering . ... ... Among the other organisations subpoenaed last week were Kroll Associates, corporate investigators, and First Union National Bank and Bank of New York .

Through the wringer: The challenge of money laundering : Banks are doing more than ever before to clamp down on money laundering . But is it enough?
 
04/14/2001 The Economist . The revelation in 1999 that the Bank of New York had become a conduit for billions of dollars of suspect Russian money drew attention to an arguably more serious issue, the use in money laundering of "correspondent banks" - banks that have their own account at another bank. Dirty Russian money was washed through the Bank of New York 's systems via its correspondent banks, including one called Inkombank.   

2 Accused of Fraud Using Shell Companies

By GRETCHEN MORGENSON; 04/06/2001 The New York Times Chipping away at the wall of secrecy surrounding the operations of offshore banks, Robert M. Morgenthau, the Manhattan district attorney, announced the indictment yesterday of two prominent lawyers on charges that they helped orchestrate an international stock fraud operating in New York and Britain. ...  According to Mr. Morgenthau, Mr. Creggy also set up shell companies in the Isle of Jersey for people laundering Russian money in the Bank of New York in a case that broke in 1999.

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Bank of NY's Renyi got $12.1 million bonus in 2000.

03/20/2001 Reuters English News Service NEW YORK, March 20 (Reuters) - Bank of New York Co. Inc. paid its chairman and chief executive, Thomas Renyi, a $12.1 million bonus last year, more than double his 1999 bonus, as the regional bank's annual profits rose 15 percent.

Witness in the Bank of New York Case Attacked

MT~Wire By Maria BERDNIKOVA March 15, New York  A Russian witness who traveled to New York to testify in the case of BoNY shareholders against its management ended up in the hospital shortly after return to Moscow.

SEC To Mull Wall St Money Laundering Prevention

WASHINGTON -(Dow Jones)- The Securities and Exchange Commission plans to step up efforts to ensure Wall Street has procedures in place to combat money laundering . ...  The vulnerability of the U.S. financial system was highlighted by the disclosure in 1999 that $7 billion in suspicious Russian funds had moved through three accounts at Bank of New York Co.

Banker Told to Submit Records

March 2, 2001 The New York Times (By BLOOMBERG NEWS) A federal judge has ordered the chairman of the Bank of New York Company, Thomas A. Renyi, to surrender telephone records, tax returns and credit card statements in a lawsuit by shareholders that accuses him and 18 other officials of roles in a money laundering scheme.

Bank of New York's Renyi Told to Surrender Phone, Tax Records

By David Glovin New York, March 1 (Bloomberg) -- The Bank of New York Co.'s chairman Thomas Renyi has been ordered by a U.S. judge to surrender telephone records, tax returns, and credit card statements to lawyers suing him and 18 other officials over their alleged role in a massive money laundering scheme.

J.P. Morgan Chase, Others Are Criticized Over Correspondent-Banking Standards.

By PAUL BECKETT Staff Reporter of THE WALL STREET JOURNAL February 28, 2001 NEW YORK -- J.P. Morgan Chase & Co., Bank of America Corp. and Bank of New York Co. responded sloppily to warnings that two Caribbean correspondent-banking clients were involved in suspicious activity during the 1990s, according to a Senate staff report.The report called the responses a further sign of lax controls at U.S. banks.

U.S. Senate investigators on Wednesday faulted several major U.S. banks

02/28/2001 Reuters English News Service U.S. Senate investigators on Wednesday faulted several major U.S. banks for failing to pay enough attention to accounts they held for foreign counterparts allegedly linked to money laundering and other crimes.

GAO Is Probing Wall Street's Programs That Guard Against Money Laundering

February 12, 2001   By PAUL BECKETT  Staff Reporter of THE WALL STREET JOURNAL. What is Wall Street doing to guard against money laundering? That's what U.S. Senate staff investigators -- fresh from releasing a study that showed U.S. banks have been used by foreign and offshore banks to move large sums of dirty money through the U.S. financial system -- want to know. ... The vulnerability of the U.S. financial system was highlighted by the disclosure in 1999 that $7 billion in suspicious Russian funds had moved through three accounts at Bank of New York Co.

Dirty-Money Flow in U.S. Banks Is Huge, a Senate Report Finds

The vulnerability of the U.S. banking system has been a concern since a scandal involving about $7 billion in suspicious Russian funds that moved through three accounts at Bank of New York Co. came to light in 1999. ...  The new report suggests such concerns are far from limited and raises questions about the ability of banks to control the billions of dollars that flow through them electronically each day.

Banks Vulnerable to Laundering

By REUTERS 02/05/2001 . The investigation was launched after the Bank of New York (BK.N) was caught up in a probe of alleged money laundering by suspected Russian mobsters and businessmen, spurring concern about U.S. banks' role in a growing global problem. Attempts to tighten U.S. money laundering rules during the last Congress foundered amid opposition from the banking industry and privacy concerns, but the effort is likely to be renewed this year.

Caribbean Governments Close Suspect Foreign-Owned Financial Institutions

02/21/2001 KRTBN Knight-Ridder Tribune Business News: The Miami Herald - Florida Investigators say British Bank of Latin America is a case study of what happens when an offshore bank and major U.S. correspondent bank -- in this case, Bank of New York -- fail to guard against Colombian money laundering. U.S. banking regulators said British Bank of Latin America received $1.57 million that was wired--at the instruction of drug traffickers--to the bank's correspondent account at the Bank of New York during Operation Casablanca, a money laundering sting conducted by the U.S. Customs Service from 1995 to 1998. During Operation Juno, another money laundering sting, U.S. indictments also referred to $1.1 million in drug proceeds sent to the bank.

More spies in Russia

01/15/2001 Business Week Russia, already known for its ample supply of intelligence operatives, looks set to increase those ranks with the establishment of a new agency aimed at combating rampant money laundering , tax evasion, and other financial crime.

In His First Days, Bush Plans Review of Clinton's Acts

New York Times By DAVID E. SANGER and FRANK BRUNI CRAWFORD, Tex., Jan. 12 [President-elect] Bush was dismissive of the Clinton administration's eight-year-long use of direct financial aid to Russia, part of a broad Western effort to coax the country toward a market economy. He suggested he would try to stop the money — except for that used to dismantle nuclear weapons — until Vladimir V. Putin, the Russian president, cleaned up corruption and enacted far-reaching economic and legal reforms.

International groups rethink approach to Russia, take tougher stance: Reduce commitments

01/06/2001  National Post The fading memory of the collapse of communism, disillusionment over the slow pace of progress, and recent scandals including allegations of money laundering through the Bank of New York and Russia's campaign in the breakaway republic of Chechnya and cultivation of "pariah states" have done much to reduce the appetite for increased support.

Global Money Launderers

December 22, 2000 New York Times. America's security is threatened by the spread of international crime cartels, a dark side of globalization. A valuable new White House report documents how the collapse of the Soviet Union, the lowering of trade barriers and advances in telecommunications have increased the reach of crime syndicates, from Russia and Eastern Europe to Asia, Latin America and the diamond-rich war zones of Africa... ...In the wake of the Asian and Russian financial crises and last year's Bank of New York scandal, in which Russian oligarchs moved billions through accounts at the bank, the Group of 8 industrialized countries started a campaign to "name and shame" countries that were lax about laundering.

Bank of New York Loses Yet Another Round In Court

NEW YORK, DECEMBER 18 (MT) – A decision and order filed on December 15 in the Supreme Court of the State of New York denied BoNY’s request to halt BoNY shareholders' investigation into alleged corruption and money laundering by BoNY’s highest management.

Judge in Bank of New York Case Concludes Charges are not Frivolous

DECEMBER 13, 2000  (MT) – Today US District Judge Denny Chin once again denied BoNY’s request to halt BoNY’s shareholders investigation into alleged corruption and money laundering by BoNY’s highest management.  Judge ruled that the “substantial charges” against BoNY have been supported by “detailed factual allegations” and are  “nonfrivolous.”

Russian To Sign U.N. Crime Treaty

Dec. 11, 2000  (AP) Russia said Monday it will sign a United Nations treaty aimed at combatting international crime, including money laundering and trafficking in women for prostitution. The treaty also includes measures to protect witnesses who testify against crime groups and holds multinational companies liable if implicated in money laundering cases.

Have the World Bank Investigators Suppressed Evidence of the Bank of New York Abuses Involving Aid to Russia? (MI-PP-8134)

Citibank laundering claim

12/10/2000 The Independent - London JAMES CRUICKSHANK IN NEW YORK. The lapses in compliance and monitoring in the company's Citibanking unit have come to light at a time of heightened sensitivity over Russian fund transfers through US banks because of the money- laundering investigation into about $7bn in Russian funds transferred through accounts at Bank of New York . That was revealed last year when the Russians asked the FBI for help in tracing $300,000 in ransom money from a kidnapping which led to the money- laundering operation at the Bank of New York

The Billion-Dollar Shack

12/10/2000 ... last year's Bank of New York money- laundering scandal, which rocked the financial world, washed $7 billion... ...The recent Bank of New York scandal revealed not only the latest techniques in money laundering but also the critical role a tiny nation like Nauru can play. The scheme was designed by Russian bankers but was run by a married couple in New York -- Peter Berlin and Lucy Edwards, a vice president of the Bank of New York . (Edwards was born Ludmilla Pritsker in Leningrad.) Beginning in Moscow, two established banks, Sobinbank and MDM, opened two separate banks -- Depozitarno-Kliringovy Bank, or DKB, and Flamingo Bank -- to serve as the conduits for fleeing funds

Weekly Financial Update -- Citigroup Concedes Lapses in Transfer of Russian Funds

12/01/2000 Dow Jones Business News. Citigroup Inc. is acknowledging lapses in its U.S. branch-banking operations that allowed about $725 million in questionable Russian funds to flow through more than 100 accounts from 1991 to this year, much of which went to offshore banking havens.

GAO Cites Bank Lapses, Suspects Laundering

11/30/2000 Los Angeles Times WASHINGTON -- Financial services giant Citigroup Inc. and Commercial Bank of San Francisco violated control rules and allowed about $1 billion in possibly illicit Eastern European money to move through their accounts, congressional investigators say.

Inquiry Grows in Laundering of Money

New York Times By RAYMOND BONNER, WASHINGTON, Nov. 29, 2000. A Congressional inquiry has found that it is "relatively easy" for foreigners to hide their identities and form shell companies here that can launder money through American banks.

Swiss Raise Sum in Bank Case, to $500 Million

New York Times, November 15, 2000; By ELIZABETH OLSON. An investigation has turned up evidence that $500 million, far more than previously believed, was transferred to Swiss banks from accounts at the Bank of New York as part of a Russian plot to avoid taxes and launder money.

Bank Of NY/Suit -2: Seeks $40M Plus Interest, Fees
11/15/2000 Federal Filings Newswires -- Bank of New York (BK) is being sued by three alleged shareholders of Joint Stock Bank  Inkombank , according to the company's most recent quarterly report filed with the Securities and Exchange Commission.

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TERRORISM and

MONEY LAUNDERING

Laundering of Russian funds through Swiss banks "far larger" than thought

11/14/2000, BBC Monitoring. The size of Russian funds laundered through the Bank of New York , and transferred through Swiss accounts, has turned out to be far larger than previously reported. During a seminar on corruption, Geneva judge, Laurent Kasper-Ansermet, revealed...

Bank of New York, Renyi, Lose Bid to Dismiss Shareholders' Suit

New York, Nov. 28 (Bloomberg) -- The Bank of New York has lost a bid to dismiss a suit alleging that 19 senior officials allowed the bank to launder money as it aggressively expanded in Russia. U.S. District Judge Denny Chin on Nov. 13 refused to dismiss or suspend the suit, which names the bank's chairman and chief executive Thomas Renyi as a defendant. Bank lawyers had asked Chin to permit the bank's special litigation committee to complete an internal investigation of whether the suit had merit.

Judge Doubts the Bank of New York can Investigate Itself

NEW YORK, NOVEMBER 13 (MT-WIRE) – Today federal judge Denny Chin denied BoNY request to stay the lawsuit brought by BoNY shareholders against its management to give BoNY’s directors time to investigate allegations of wrongdoing by BoNY’s management on their own. Noting that there is a “substantial question” whether BoNY’s newly formed “special litigation committee (SLC)”, commissioned to investigate shareholders’ allegations, is truly independent and disinterested, judge Chin wrote in his decision: “it is difficult to imagine that the SLC will reach any conclusion other than that the [shareholders’] complaint lacks merit...”

BoNY Lawyers Argue in Court that Russian Justice Ministry is not a Government Body

Moscow Telegraph, November 10, 2000.   by:  Rod DOZOROV in Moscow and Andy LIGHT in Washington. New York,  (MT-Wire) Bank of New York lawyer, Richard Klapper, submitted an affidavit in New York federal court stating that the Ministry of Justice of Russia is in reality a "bar association", not an agency of the Russian Government.

The Bank of New York Management Attacks Director of American Russian Law Institute

09/12/2000 (Moscow Telegraph) Moscow Telegraph, New York -- Confronted with allegations of massive corruption and negligence of BoNY’s senior management, asserted in the lawsuit of BoNY’s shareholders against the Bank directors, BoNY’s seniors endeavored a peculiar spin -- blaming their trouble on ARLI Director, Emanuel Zeltser 

Bank of NY Suit Proceeds in NYS Court

May 30, 2000 law.com The New York Supreme Court need not stay litigation stemming from money-laundering charges against the Bank of New York because there is a pending federal case asserting the identical claims, a Manhattan Supreme Court justice has ruled.

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