Whistleblowers Allege Bank Caters to Sanctioned Russian Oligarchs

As reported in Bloomberg, Kohn, Kohn & Colapinto “represents two whistleblowers outside the U.S. who claim a bank caters to sanctioned Russian oligarchs and entities and may have failed to flag suspicious flows of Russian money through the U.S.”

In order to protect the anonymous whistleblowers from retaliation, Kohn, Kohn & Colapinto is not identifying the bank facing the allegations.

The whistleblowers’ disclosure came following the enactment of the Anti-Money Laundering Whistleblower Improvement Act on December 29. The law, which Kohn, Kohn & Colapinto’s pro bono advocacy played a key role in passing, expands whistleblower protections and awards to individuals reporting sanctions violations.

“It is going to hit Putin and his cohorts where it hurts,” KKC founding partner Stephen M. Kohn told Bloomberg.

The AML Whistleblower Improvement Act amends the AML Act to entitle qualified sanctions and money laundering whistleblowers to awards of 10-30% of the funds collected by the U.S. government in an enforcement action connected to their disclosure. The law also establishes a fund to pay whistleblower awards which is entirely financed by penalties imposed on individuals and entities charged with money laundering and sanctions violations.

“Although the AML Whistleblower Improvement Act broadly covers violations of both money laundering and sanctions requirements, the ability to use this law immediately to enforce all of the financial restrictions placed on Russia after the invasion of Ukraine was the driving force behind its passage,” Kohn wrote in a recent Reuters article on the law.

“The hidden gem within the AML Whistleblower Improvement Act is its ability to incentivize whistleblowers from inside Russia and Russia’s trading partners,” Kohn continued. “Given the law’s transnational reach, citizens from countries with financial or trade relations with Russia will have the ability to safely and effectively blow the whistle and help U.S. authorities seize sanctioned Russian wealth.”

Individuals considering blowing the whistle on money laundering and sanctions violations should first consult an experienced AML whistleblower attorney to ensure they are fully protected and qualify for the largest possible award.