With the investigators out of the way, Hogan Lovells forged ahead. It turned to a second audit by Ernst & Young. Based on files the bank had made available, the auditors had failed to corroborate much of what FinCEN was alleging. Hogan Lovells brandished the audit in its next filing to FinCEN, claiming it showed why FinCEN should back down.



The claim that the Ernst & Young audit amounted to a clean bill of health left US officials flabbergasted, a US government source close to the matter told BuzzFeed News. Attached to the report were pages and pages of raw account information that, far from disproving the allegations against FBME, actually bolstered the US government’s case, this person said, and helped investigators make additional connections.

In the years leading up to the poison gas attacks launched by Syrian President Bashar al-Assad on his own people in 2013, FBME had funnelled hundreds of millions of pounds through the accounts of Issa al-Zeydi, a Moscow-based financier for the regime’s chemical weapons programme. And the money kept flowing even as images of young children foaming at the mouth and fighting for breath sent shockwaves around the world. Zeydi was sanctioned weeks after the first public notice against FBME. The US government later issued sanctions against at least seven other FBME clients over their financial links to the Assad regime.

To the US government, the presentation of this audit as an exonerating document was yet another sign that FBME was not serious about dealing with its failings. “We thought that they’d come out and say, ‘You got us, we’re cleaning it up, how can we work together?’” the official close to the matter said. But “they never wanted to acknowledge the problem”.

The Saabs said in their statement through their lawyers that they had provided Ernst & Young “full and unexpurgated access to client files” and that “these are hardly the actions of party that has something to hide”. While they acknowledged that some of the individuals named in the report were sanctioned, they said there was no evidence that those clients had used their accounts at FBME to funnel money to the Syrian regime and their accounts were stopped as soon as sanctions were issued.

In any case, FinCEN was unimpressed, and in summer 2015 the agency issued a final declaration that it was going to cut off FBME from the US dollar because, in the words of FinCEN’s director, “the United States will not allow a compromised foreign bank to send dirty funds through the U.S. financial system.”

The Saabs had one last option: sue the US government to prevent the action from taking hold. They returned to Quinn Emanuel – and Burck jumped at the chance to come back and fight FinCEN.

Most of FinCEN’s evidence against FBME was classified, and Burck said that offended him. He was “worried” about what FinCEN might have in its “black box” of secret evidence, he said, and if the agency “had produced definitive evidence that the bank was facilitating chemical warfare I would not have continued”. But he pressed ahead because “I do think it’s morally wrong to condemn someone on the basis of secret evidence”.

Quinn Emanuel added another top partner to lead the charge alongside Burck: Derek Shaffer, a highly sought-after white-collar crime defender with a gift for rhetorical flourishes. If FinCEN could treat FBME so unfairly, he declared in early court filings, “then banks all around the world must tremble”. Hogan Lovells signed on to the suit as well, and the two firms submitted the Ernst & Young and KPMG audits as evidence in the bank’s favour.

US District Court Judge Christopher Cooper handed FBME a couple of victories, ruling that FinCEN had failed to give an adequate public explanation of why it was targeting FBME. FinCEN responded with a more detailed case against the bank, and it added a new allegation to the mix: FBME’s employees had taken “various measures to obscure information” after the agency issued its first public notice against the bank.

The claim that FBME staff had tried to hide information “is a uniquely damaging allegation”, Shaffer told the judge. Had FBME been given notice, it “would have launched an internal investigation”.

By then, the findings of the bank’s previous internal investigation had resurfaced. A few months after Brown and Leighton’s investigation had been shut down, the Central Bank of Cyprus had ordered them to hand over their findings and materials. They had complied, preparing detailed affidavits running to almost 200 pages supported by a cache of internal documents. The central bank commissioned a review of their evidence, and it confirmed many of their findings. But then Brown sent the same package of evidence to FinCEN.

In spring 2015, just as Brown and Leighton were making contact with government investigators, Hogan Lovells and Quinn Emanuel began pelting the investigators with letters, demanding that they return all their files and claiming that providing the Cypriot government with information about the bank was a “violation” of their engagement agreements. One of the letters had come from Burck personally. He said he was obligated to enforce client confidentiality because Brown and Leighton had been working under his auspices.

Once they learned that the evidence had been sent to FinCEN, the lawyers claimed in court that Brown and Leighton’s affidavits were “saturated with gross, bad-faith distortions and outright falsehoods”, accusing FinCEN of using the investigators’ materials “in flagrant violation of attorney-client privilege” and urging the judge to toss out the dollar ban. The judge swatted away the accusation that FinCEN’s ruling had been tainted by Brown and Leighton’s evidence, noting that the agency had enough separate evidence to prove its case without the investigators’ materials. Having lost that battle, Quinn Emanuel sued Brown and Leighton on behalf of the Saabs in London for disclosing confidential information to the regulators. That case is ongoing.

Meanwhile, Brown and Leighton had filed their own lawsuit against FBME in Cyprus, alleging the bank had failed to pay their invoices totalling £240,000 after sacking them.

FinCEN ultimately won its case against the bank in the US, and FBME was cut out of the American financial system. But the Saabs and Quinn Emanuel are still fighting, most notably in their claim against the Republic of Cyprus in a highly secretive global court that settles disputes between corporations and nation states. The investor-state dispute settlement tribunal system was exposed by BuzzFeed News last year for frequently favoring corporate interests over small governments and allowing executives to escape punishment for their crimes. In that venue, the Saabs are demanding that Cyprus fork over $1.3 billion in damages for taking control of the bank’s accounts. That is equivalent to 15% of the Cypriot government’s entire annual budget and could prove ruinous for the tiny island nation. That case was heard earlier this year, and both sides are now awaiting the decision of a panel of three arbitrators.

As the Saabs’ many fights have slogged through courts around the world, hundreds of millions of dollars in deposits have remained frozen. As a result, many of FBME’s legitimate depositors haven’t been able to access much of their money, said Floris Alexander, whose firm Legal Floris LLC represents 1,500 of the bank’s clients. “They keep waiting, they’re still in limbo,” Alexander said. “There are people losing their life savings.”