In this week’s episode of This Week in AML, John Byrne and Elliot Berman unpack a wide range of global financial crime and compliance developments shaping the risk landscape.
The conversation begins with the significance of Hungary’s election results and what a potential reversal of entrenched corruption could mean for democratic institutions and Ukraine. The episode also covers leadership changes at IRS‑CI, new OFAC sanctions targeting cartel‑linked money laundering and cash smuggling, and updated FinCEN FAQs tied to Geographic Targeting Orders.
Additional topics include New York’s crackdown on insurance fraud, emerging concerns around elder abuse and sextortion, rising money laundering prosecutions in Turkey following FATF scrutiny, and fresh FCA findings on weaknesses in CDD and EDD practices. The episode closes with a discussion of a reported proposal that could require U.S. banks to collect citizenship documentation—raising major operational, compliance, and debanking concerns.
Corruption Crackdowns, Sanctions, and New Compliance Pressures - Transcript
Elliot Berman: Hi, John. How are you today?
John Byrne: I'm good. Elliot, it's 90 degrees here in Northern Virginia after being in the sixties a couple days ago, I'm sure you guys are getting variations of changes in weather as well.
Elliot Berman: We are. It was in the upper seventies yesterday. Today it's in the, upper sixties. We've had a lot of rainstorms come through. I think we're supposed to get some more later today. But it's nice to be out of the thirties. So we'll see.
John Byrne: The 1930s. Oh no, wait, that's something else.
Elliot Berman: Yeah, that too.
John Byrne: All right, so we are I don't even remember what week this is in terms of the war, but we're still doing that. We're apparently closing the strait. Opening the strait. We'll leave that national, international security issues unrelated to AML to everybody else out there. But obviously that's going on.
I do wanna mention something that occurred over the weekend that's very relevant to the anti-corruption space. And that's the the results of the Hungarian election. As everybody knows by now, Orban lost and he lost big. Probably why he conceded 'cause there was no chance if anybody thought he wasn't going to either leave office or challenge the result.
What's really fascinating is his opponent Péter Magyar is not any particular progressive, he's more of a center right. But he wanted to reverse all of the corruption issues that many have claimed have occurred in the past 16 years. So I think that's good news for a country that held Democratic elections that they've finally got fed up. It wasn't just corruption, but obviously they were targeting journalists, targeting universities.
Some of this I realize is sounding familiar but the bottom line is people came out and voted and they voted in large quantities. And then more importantly tremendous significance for Ukraine because Magyar has already said that Hungary will no longer act as a Russian puppet. He's no longer blocking EU aide to Ukraine and sanctions on Russia. I think that's good news for our colleagues in Ukraine that must be feeling better about this given what happened. So anyway, I think because of the anti-corruption claim that he had, that's really important.
And so I thought we would start with that.
Elliot Berman: Agreed. We talk a lot about the impact of global corruption on the rule of law. But also on creating environments that are fertile for financial crime, money laundering, fraud. So I think this was a really good sign. There are many commentators who are talking about whether this will be an anomaly or whether this might be the beginning of a trend back, the other way away from some of the, less democratic leaders that we've seen elected in parts of Europe and other parts of the world. So where would you like to go from there, John?
John Byrne: And the good news portion of our conversation wanted to mention whether we talked about this before, but the IRS:CI new chief is now officially in role. And that's Jared Koopman, who has been with IRS for 26 years. Done quite a bit. He's presented on cyber and related topics to the private sector. We were able to meet him at our forum last month. Congratulations to Jared. And I know that IRS:CI is in good hands with his oversight.
Elliot Berman: Yes. And he spoke very positively about the value of public-private partnerships at the forum. And I think that the experience we've had with IRS:CI will continue under his leadership and I too wish him well in his new role.
John Byrne: Just a couple other quick things. OFAC, Treasury's office for asset control has announced that they've sanctioned six targets involved in money laundering, cash smuggling, enterprise operated by Cartel del Noreste one of Mexico's most violent drug trafficking organizations.
That group, CDN is a US designated FTO foreign terrorist organization that according to the note here, exerts significant influence along the US Mexico border near Laredo, Texas. Wanted to mention that OFAC has sanctioned the casinos there and key associates.
Elliot Berman: And FinCEN put out updated fAQs for the geographic targeting orders related to the Minneapolis area. So for those of you who are tracking that you should take a look at those.
John Byrne: One quick thing about those FAQs in case you wonder what the penalties are. The FAQs say that if a business willfully violates the GTO and also any partner director who willfully participates, could be liable for the following civil and criminal penalties.
The civil penalties are the greater of either $71,545 or the amount involved in the transaction up to. $286,184 and a separate penalty may be applied for each violation. Not sure how they came up with those numbers, but that's what's there. The criminal penalties is a fine of not more than $250,000 and or imprisonment for not more than five years, and that's based on an announcement back in January of 2026.
Elliot Berman: We saw also that DFS in New York is partnering in a program with the New York State Police to crack down an insurance fraud. And the particular focus is they've had a, significant uptick in staged accidents and then people making insurance claims being paid out, and then the money going to the bad actors.
It's an ongoing program, but they recently hosted a specialized training for 250 investigators, troopers and personnel from local law enforcement agencies. To help detect and prosecute these financial crimes. You and I talk about a lot of different financial crime. I don't know that we've talked much about insurance fraud, but it's been a problem for many years in many forms.
This apparently has truly gotten out of hand. And it was interesting to see that the financial regulators and the traditional police in New York were getting together about something like this.
John Byrne: Just real quick I know we're talking about this at the end. We have a webinar coming up next week that's gonna deal with elder abuse and other frauds like sextortion. A former guest of ours and well-known in the, technology and AML space. Alison Jimenez, you should follow her on LinkedIn and she's with Dynamic Securities Analytics. She published some statistics from some reporting regarding teen extortion, victim obviously some analysis in there as well.
I won't go through it all, but when you get a chance, if that's an area you're focused on or interested in take a look at that. But again, that's something posted by Alison Jimenez from Dynamic Securities Analytics.
Elliot Berman: And you and I saw an interesting report. I guess they're reporting a rumor at this point because it has not been confirmed by any governmental agency, but apparently the Secretary of the Treasury stated that semi-public dinner that the White House is working on a an executive order that would require banks in the United States to collect citizenship information.
There is no executive order that's been issued. The White House some months ago when this rumor first started circulating denied that any, that anything was happening but apparently based on the secretary's comments the plan would require banks to ask customers to present a document such as a passport or a birth certificate to verify citizenship in addition to the current standard documents for opening an account.
I think there's a couple interesting things. First, if it in fact happens, if it would be retroactive, banks would have to talk to all their existing customers and gather this information. And that is a huge lift. Secondly and passport isn't the only document you could use, but there are about 183 million US passports in circulation as of the end of 2025. We have a population of about 340 million people. Now, not every one of those 340 million people has a bank account, admittedly, but it's interesting, there's quite the gap between people carrying passports in the US and total citizenship.
The other thing that's interesting, for those of you who've been around for a while, you'll remember that there have been many discussions in the United States. Certainly I would say beginning back around the Reagan administration and coming forward, about the idea of some kind of national ID card. It has never been enacted. In part because privacy advocates along the political spectrum and others have felt that it was intrusive.
We have a version of it with REAL ID on driver's licenses. But again, everyone will recall that it took a long time for that to get implemented. There were several delays, some of them related to the challenges of going into motor vehicle departments during the pandemic, but some of them, just everybody figuring out how to do it.
So we'll see if this executive order actually comes out. I guess the last thing I would comment, and John I know this is an issue that's near and dear to your heart, is given all the things that we've seen come out recently about under the guise of de banking. I think it's interesting now we may be creating, if this would happen, we could create a new group of people who get de banked, and that's people who can't, not that they're not citizens, but may not have the proper documentation to prove that they're citizens.
John Byrne: You know the article quotes from two folks. One is Jeremy Kress, who's an associate professor of business law at the University of Michigan. He said that the plan was, quote, a way to weaponize the banking system to achieve political ends, unquote. And I gotta read this one. A financial service lobbyist is he's he or she, his name is not disclosed, said the following quote, the admin might think this is a good idea until Joe MAGA in Alabama is asked to present his papers unquote. So we'll see how this turns out.
Elliot Berman: Again, it could just be a rumor, but there was reasonably explicit description of the where and the when of the Treasury secretary's comments in this dinner.
Did you see the thing about the surge in money laundering cases that are being dealt with by the courts in Turkey?
John Byrne: No. Why don't you go ahead. And I do have one more thing.
Elliot Berman: Okay. At the end of 2025, the courts in Turkey have dealt with over 12,600 money laundering cases involving about 18,000 defendants and about 28,000 underlying offenses. That's a significant increase. So for example, at the end of 2024, the the number of cases for that year was just over 5,000.
And here's why I think this is interesting. The rise in cases follows increased scrutiny of Turkey's AML framework. FATF put Turkey on the gray list in 2021. And this was over deficiencies in tracking money laundering and terrorist financing. It exited the list in 2024 and now in 2025, under an updated regime that was more aligned with FATF's recommendations and international norms.
Now we're seeing, actual cases moving through the system as a result of that change in framework. So I think that's interesting. I can't say one set of events proves the value of FATF, but there is a clear through line here and I think that's good for those of us who feel like the FATF process has great value.
John Byrne: The OCCRP in their weekly newsletter, and it's free, so you should subscribe. One of their major stories is the Ukrainian anti-corruption agencies have wrapped up their investigation into a prominent, but thus far, unnamed member of Parliament. Suspected of orchestrating a vote buying scheme, clearing the way for the case to go to trial. And the National Anti-Corruption Bureau of Ukraine and specialized anti-corruption prosecutors' office claimed that the lawmaker attempted to establish an official but semi formalized bribery network within the legislature from December of last year, under which lawmakers would receive money for voting or abstaining as instructed.
The reason to read that is 'cause obviously there's been many claims about corruption in Ukraine from Putin and others. Clearly not just from this example, but there's been extensive work done over the course of a number of years to attack corruption systems and issues. And this is just another example of that.
Elliot Berman: The last thing I have is the FCA in the UK, they've done a research study and the output of that is highlighting good and poor practices in the CDD area. The review examined CDD and EDD and ongoing monitoring across a range of firms. And some of the weaknesses they found were organizations where the review cycles were not detailed enough to know how often the periodic reviews should be taking place. The lack of clarity over what they should do if an event driven review happens. So an off cycle review. And that there isn't sufficient clarity to specify when senior management approval is needed.
Also, a number of the organizations they looked at failed to produce any evidence of what EDD measures had been taken and recorded. Classic example of what we all talk about, which is if it isn't written down, it didn't happen. And it's interesting it's worth a look I think whether you're in the UK or not, but particularly in the UK And just to take a look at your own processes and procedures and be sure that even if you're doing it well, that it's documented well.
John Byrne: That's it on my end. In terms of programming coming up. I had a very fun and interesting interview with Paul Camacho, who is with a a major casino on the West Coast. And he talks a lot about, the gaming industry and AML and that'll come up in the next week or so.
As we mentioned, we have a webinar coming up on the 23rd. To deal with elder abuse, extortion, and related crimes. Still plenty of time to sign up for that. Elliot, I know you're gonna go on a well-deserved vacation, so we're gonna wish you well. Anything else you wanna mention before you sign off?
Elliot Berman: It's just one more detail. The webinar on the 23rd will live stream at 1:00 PM Eastern Time. And as you mentioned, you can still sign up at our website. Yes, I'm gonna be on a very interesting trip/vacation with a large part of my wife's family related to, their mother, my mother-in-law escaping the Nazi regime in 1939. She grew up in Germany with her parents. So it's gonna be quite fascinating.
I'm leaving you in good hands with our colleague, Joe McNamara for next week. And I know you'll do great and I'll listen to it on the plane home.
John Byrne: Hopefully you'll have other things to listen to as well, but we'll try to make it as interesting as possible.
Elliot Berman: Thank you very much. All right, John. You have a great week and I'll talk to you in two weeks.
John Byrne: Stay safe.
Elliot Berman: You too. Bye-bye.