The New Yorker just broke a story reporting that much of the information news outlets reported last week about Michael Cohen’s pay-to-play scheme came from a law enforcement whistleblower who worried a cover up might be under way. That suspicion began when the official could find no evidence of certain suspicious financial activity—or Suspicious Activity Reports (SARs)—related to Cohen’s account at First Republic Bank in a government database. The missing SARs (several) detailed money paid to Cohen by corporations like Pharma giant Novartis, AT&T and other entities that account for “more than three million dollars” worth of transactions (in other words, far more than what we learned about last week). Ronan Farrow writes:
According to the official who leaked the report, these SARs were absent from the database maintained by the Treasury Department’s Financial Crimes Enforcement Network, or FINCEN. The official, who has spent a career in law enforcement, told me, “I have never seen something pulled off the system. . . . That system is a safeguard for the bank. It’s a stockpile of information. When something’s not there that should be, I immediately became concerned.” The official added, “That’s why I came forward.”
Seven former government officials and other experts familiar with the Treasury Department’s FINCEN database expressed varying levels of concern about the missing reports. Some speculated that FINCEN may have restricted access to the reports due to the sensitivity of their content, which they said would be nearly unprecedented. One called the possibility “explosive.” […] A former prosecutor who spent years working with the FINCEN database said that she knew of no mechanism for restricting access to SARs.
And—here’s our first hint at where that money was going.
A substantial portion of this money seems to have ended up in Cohen’s personal accounts. Morgan Stanley Smith Barney filed a separate SAR showing that, during that same three-month period, Cohen set up two accounts with the firm, into which he deposited three checks from his Essential Consultants account, two in the amount of two hundred and fifty thousand dollars and one in the amount of five hundred and five thousand dollars. Morgan Stanley Smith Barney marked those transactions, which added up to more than a million dollars, as possible signs of “bribery or gratuity” and “suspicious use of third-party transactors (straw-man).”
This official could end up being in a lot of trouble even as they provided the public a window into the shadowy world that appears to be overtaking our government.
“The official who released the suspicious-activity reports was aware of the risks, but said fears that the missing reports might be suppressed compelled the disclosure. “We’ve accepted this as normal, and this is not normal,” the official said. “Things that stand out as abnormal, like documents being removed from a system, are of grave concern to me.”
Amen. It’s no time for any of us to look the other way.