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Tyler Comrie for BuzzFeed News

In the shadowy world of the student loan debt industry, even the companies that call themselves the good guys sometimes deal in the darkness.

The Student Loan Assistance Center has positioned itself as a model actor in the country's troubled tangle of student debt settlement companies. But for years, it misled and overcharged desperate student loan borrowers, mishandled accounts, and sometimes lied on federal documents, according to four of the company’s former employees.

The employees, along with documents and legal filings from a consumer protection lawsuit, paint a picture of a business with a cutthroat, Wild West sales environment that fostered the mistreatment of some of the company's more than 30,000 customers — while spinning a broken student loan system into pure profit for its owners.

At the same time it was engaged in many of those practices, the company, known as SLAC Inc., and its CEO, Adam Owens, were busy making a case to Congress and Washington that it was the face of a legitimate and unfairly persecuted industry.

Adam Owens

Via youtube.com

The world of debt settlement firms — the companies behind the onslaught of calls promising loan forgiveness that beleaguer many consumers — encompasses hundreds of small and medium-sized companies across the country, as well as hundreds of thousands of consumers and millions of dollars of federal loan money. Most companies have made a business out of charging consumers to fill out consolidation and enrollment forms that are available, for free, on government websites.

Reviled by people on by both sides of the political aisle, the industry has been beleaguered by years of regulatory crackdowns and even government ad campaigns to steer consumers away from their businesses.

But Owens sought to bring SLAC, and other debt relief companies along with it, into the bright light of day. He thought he could convince Washington that the industry had been unfairly tarred by a few bad actors — winning them favorable treatment from regulators. Most debt relief companies, he argued, were like SLAC: doing good and legal work on behalf of students who were otherwise being abandoned by the system.

Owens told BuzzFeed News that SLAC is a necessary piece in a broken government student loan system.

Owens wanted to “educate Congress” and “open up a dialogue with regulators,” he told BuzzFeed News. He was hoping, he said, to “promote the message that there are good companies out there who provide a useful service and value to the American people.”

Owens and SLAC hired the Penn Hill Group, an education lobbyist whose clients included the College Board and many of the country's largest college accreditors, and met with members of Congress. He enlisted one of Mike Pence’s closest allies, Marty Obst, to stand next to him onstage at an annual industry conference, where Obst and Owens argued together that the companies should form a PAC that would fight regulatory overreach. Owens even took SLAC’s case, he claimed, to White House staff and Washington regulatory agencies. He went to the Education Department, where he spoke with staff who helped run the massive federal student aid program.

SLAC is a necessary piece in a broken government student loan system, Owens told BuzzFeed News, filling a yawning gap that government loan servicers, because of time and financial constraints, cannot. Only a small fraction of the nation’s borrowers are enrolled in the government’s income-based repayment plans, Owens pointed out. Many of SLAC’s customers have never heard of programs that were designed to help them until they come across one of the company’s ads.

For financially unsophisticated borrowers, some government forms are confusing and can be time-consuming. Servicers are supposed to help, but usually don’t: The government pays hundreds of millions to companies like Navient and FedLoan, which have been accused by government watchdogs and state attorneys general of mishandling loans in the pursuit of profit.

The debt settlement industry is often criticized for charging people for things they could otherwise do for free. But that's not always the way it works, Owens pointed out. "The numbers show it’s undisputed that customers are not actually getting these services for free.” SLAC performs a vital service, Owens said: “No one, other than companies like ours, is advertising these programs. Almost no one but the people in our industry is helping consumers accurately complete their applications. No one but us is following up with the loan servicers.”

But behind the scenes of its attempt to woo regulators, according to former employees and a consumer protection lawsuit, SLAC was engaged in shady business practices that hurt scores of the country’s most desperate student loan borrowers.

SLAC’s customers, the former employees said, were often people who lived on the margins: financially unsophisticated, drowning in student debt, many unemployed or disabled. The borrowers came to SLAC because of emails, letters, and texts the company and its third-party advertisers blasted out, promising loan forgiveness or lower payments through special, supposedly limited programs that were sometimes advertised as “Obama loan forgiveness.” In online reviews, people complained that they’d been steered to SLAC by letters claiming to be “final notices” on their loans and online ads saying they had only days to act before programs expired.

The phone calls from SLAC and its salespeople could be incessant: The company has been sued at least three times by people who allege SLAC called and texted them repeatedly, violating consumer protection laws.

Jennie, a former SLAC customer, was in “a very hard place” when she picked up the phone to call SLAC in 2015: struggling to get by on a series of temporary jobs, often unsure of how she would pay for rent or what she would eat at night. She’d seen an online ad, she said, that told her she might be eligible for loan forgiveness and $0 monthly payments. She was skeptical, but the ad told her she had to “hurry” and enroll before a federal deadline passed, so she managed to come up with the 600-some dollars that the company told her the program would cost. She expected to have her loans consolidated, and eventually forgiven, she said, within a matter of months.

Salespeople could essentially charge as much as they judged someone would pay.

The prices were steep, but the service SLAC offered was in fact quite basic. SLAC, like most debt settlement companies, would fill out forms to consolidate borrowers’ student loans, then typically enroll them in a plan, called income-based repayment, where monthly payments were based on what they earned. The forms were already available, for free, on the Education Department’s website, and through student loan servicers, who are paid to help students with the paperwork. The “loan forgiveness” advertised was available to anyone who’d made monthly payments on the income-based plan — but only after 20 or even 25 years, a detail SLAC salespeople often omitted, two employees told BuzzFeed News.

SLAC’s salespeople, who were paid a 20–30% commission, had a minimum fee they were supposed to charge borrowers for the company’s debt settlement services — but exactly how much they charged was up to them, according to all four of the company’s former employees. Salespeople could, essentially, charge as much as they judged someone would pay, up to a limit of 1% of the person’s loan balance, and the more money they charged, the more money they took home. Customers had no idea. They were told the money was a set “enrollment fee,” said one former salesman, Doug — frequently giving them the impression that the money was required to enroll in the free programs.

Naming a price was a careful calculation, said Z., one former salesman, based not on the services SLAC provided but on the sales agent’s judgment about how much the borrower would be willing to pay. A good salesperson, said Z., could try to coax anywhere from $799 to $1,199 in fees from someone with a high income and loan balance.

“It didn’t stick well with me,” said Z., who worked at the company for two years. Z. and the other three employees in this story, asked not to be identified by their full names because they feared their current employment might be jeopardized.

At the core of everything done at SLAC — on the company’s sales floor and in its top ranks — was a push for financial gain, said Doug. Reliant on commissions to make “anything above minimum wage,” salespeople would eke as much in fees out of their struggling customers as they possibly could. Results were tracked publicly on a whiteboard in the front of one sales floor, Doug said, where employees were judged based on how much money they brought in.

The pressure was intense, and there was one thing that hurt sales more than anything, two former employees said: telling customers the whole truth.

To convince borrowers to pay the steep fees, all four employees said, SLAC’s salespeople often misled customers. SLAC management banned sales staff from saying explicitly that they worked “for” the Education Department, but it was a widespread practice, said three employees, to imply that SLAC was connected to the department: Employees claimed SLAC “worked on behalf of” or “had a direct line” to the agency, three employees said. There were other types of deception, too, like implying that borrowers' loans could be forgiven within a matter of months. Three employees said SLAC frequently neglected to tell borrowers that the Education Department’s consolidation and income-based repayment plans were free to enroll in — or, if they did, tried to convince them that the forms were far too complex to be handled without paid help.

Doug said he spent several months selling SLAC's services before he tried on his own to enroll in an income-based repayment plan through the government's website. "It was so easy," Doug said. That realization "was mindblowing." If he had been honest with his customers about that fact, Doug said, most would never have hired SLAC. Instead, he said, "You have to make it sound like it's some premium service you can really only get through them and the ties they have to lenders."

The company’s management knew about, and even spurred on, the practices, said three former sales employees. “We were encouraged by management to be dishonest with callers about the details in order to push more sales,” said A., another former employee, who is identified by his first initial.

Then there was SLAC’s $39 monthly “maintenance” fee, paid every month for the life of the client’s loan, which could stretch decades. While many borrowers assumed that the money was going toward their loan balances, it in fact went into SLAC’s coffers. That mistaken assumption wasn’t always an accident: Salespeople sometimes told clients that their monthly payments went to the Education Department, three of the employees said.

"You could tell people the monthly fee is 'going towards their loans,' and technically it's true, in the sense that you're saving them thousands of dollars," said Doug.

A., who worked on both the processing and sales sides of the business, said he often got calls from clients who were shocked to find they’d been paying $39 for years while their loan balance only grew.

“People would straight-up tell [clients] that the monthly servicing fees were for loans,” said A. “I would have to explain, ‘Well, your enrollment representative wasn’t accurate with the situation.’”

“We let go many contractors who were stating things to customers that they shouldn’t have.”

Owens, the company’s CEO, did not deny that employees had sometimes misrepresented the company or its services to borrowers, but said the incidents were isolated acts of individuals, not part of SLAC’s broader culture. “In its infancy, you have an imperfect company where mistakes were being made,” Owens said. A group of “disgruntled” former employees, he said, “are taking a few of the worst episodes within an organization and making them out to be normal business practice. I do not agree that the business model was to lie to consumers.”

Owens said he took steps to change some of SLAC’s missteps. He no longer allows salespeople to determine fees based on income, but charges a flat fee of $699, he said. And Owens said his remaining employees — he laid off dozens late last year — are now salaried, rather than being paid entirely on commissions. He said he “often” purged employees that were found to be violating the rules. “That’s part of why my company has such a high turnover,” he said. “We let go many contractors who were stating things to customers that they shouldn’t have.” He said that the company had also stopped using third-party salespeople, who he said were responsible for much of the misrepresentation to borrowers, and had recently hired an outside firm to monitor its compliance.

SLAC’s employees and advertisers may have sometimes given customers misinformation, Owens admitted. But every SLAC customer, he noted, signs a 14-page agreement that is clear about the company's affiliation and role. The agreement, which was viewed by BuzzFeed News, notes explicitly that the company is unaffiliated with the Education Department, that the programs are otherwise free to enroll in, that monthly fees go directly to the company and not toward the client’s loans, and that the enrollment fee is “based on the loan amount and client income.” Those items are noted in bold print, and some are also noted on the company’s website.

“At some point, we have to put the responsibility back to the consumer,” Owens said.

But problems at SLAC went deeper than how the company sold its services, the former employees said. Once the sale had been clinched and borrowers’ credit card information collected, SLAC’s employees worked to enroll clients in federal loan programs. The goal, according to three former employees, was to lower monthly payments at all costs, a promise that had been made to many customers to entice them to enroll.

To do that, employees lied on federal documents, said three former employees, by incorrectly reporting borrowers’ personal information. Two said they did not participate but personally saw their coworkers engaged in the practices and came across documents that they knew had been altered.

The most common lie was the simplest: changing the size of a borrower's household in order to lower monthly payments. Claiming that someone had two or three children instead of one, employees said, could push a client's payments down to $0 a month under income-based plans. But there were other lies, too: one employee said a colleague doctored pay stubs to lower payments; another colleague, he said, reported that a client was paid monthly instead of biweekly, halving his apparent salary.

“It’s easy to fudge these numbers.”

American Farm Bureau Federation / Via livestream.com

President Donald Trump barely addressed critical issues for America's farmers — trade and immigration — in a roughly half-hour speech to the American Farm Bureau Federation on Monday afternoon.

Though he spoke at length about low unemployment, a soaring stock market, tax cuts, and reduced regulation, Trump only touched on trade late in his address, and then only briefly. Many farmers who struggle to make a profit and rely on exports are anxious about what will happen to the North American Free Trade Agreement (NAFTA), a deal that has been hugely beneficial to agriculture and has helped to sustain a trade surplus. Yet on NAFTA negotiations, the president merely said:

We're reviewing all our trade agreements to make sure they are fair and reciprocal. Reciprocal, so important. On NAFTA, I am working very hard to get a better deal for our country, and for our farmers, and for our manufacturers. It's under negotiation as we speak. But think of it, when Mexico is making all of that money, when Canada is making all of that money, it's not the easiest negotiation. We're going to make it fair for you people again.

People commenting on the address online seemed disappointed Trump didn't provide more detail on trade.

American Farm Bureau Federation

"It was very brief, and quick, and almost an aside."

America's farm industry also relies heavily on immigrant labor, which is under threat under the current administration. The Farm Bureau said on its website, "Where American workers are unwilling or unavailable, workers from other countries have stepped in. Congress needs to pass responsible immigration reform that addresses agriculture’s current experienced workforce and creates a new flexible guest worker program. Instability in the agricultural workforce places our food supply at risk."

Yet all the president said on the issue of immigration in Monday's address was:

"We are going to end chain migration. We are going to end the lottery system. And we are going to build the wall."

Some viewers said Trump's address seemed more like a campaign speech.

American Farm Bureau Federation

American Farm Bureau Federation

As for the 2018 Farm Bill, Trump said briefly:

"I am looking forward to working with Congress to pass the Farm Bill on time so that it delivers for all of you, and I support a bill that includes crop insurance, unless you don't want me to. I guess you like it, right?"

Will Rodger, a spokesman for the Farm Bureau, said, "It was very brief, and quick, and almost an aside. We don’t have a crystal ball as to where he’s going on these issues, but the brief statements he has made about these topics still leave us with a lot of hope." He noted that Trump is the first president to address the organization in 26 years.

Farmers Voted For Trump. Now They're Worried.


Getty Images/Spencer Platt

As the bomb cyclone approached the Northeast this week and people frantically prepped for the storm, businesses were getting ready to meet the surge in demand with the help of weather data analysts.

Planalytics, a business weather intelligence company that works with retailers like Rite Aid and Ace Hardware, estimates that, based on the weather, demand for seasonal apparel increased dramatically this week across the country. Demand for boots in the Northeast was up 32%, and up 19% across the US; demand for thermals shot up 61% in the Northeast and 34% across the US; and hats, gloves, and scarves rose by 65% for the region and 44% across the US.

Retailers work with such companies to prepare for the rush of customers extreme weather can bring. Weather Trends International, a weather data and analysis company that works with retailers like Kohl’s, estimates purchases of electric blankets (which go up 24% for every 1-degree decrease in temperature) will see a 480% increase in sales this week compared to the same period in 2017; coat sales (which rise 5% per 1-degree temperature decrease) will double; and sales of sweaters and boots (which go up 5% for every degree) will shoot up by 60%.

“Retailers have to have a plan in place so they can execute,” said Evan Gold, Planalytics’ executive vice president of global services, to BuzzFeed News. “Those large-scale retailers do a good job. You can’t control the weather that happens, but you can control how you proactively put plans in place.”

@ivy.inthecity / Via instagram.com

A retailer’s buying season comes months before any shopper thinks about what they might need for the winter. It’s a delicate art of business to predict demand, supply , and — the weather.

“When you really think about what is driving retail sales, a big portion of that is what’s happening outside,” Paul Walsh, IBM’s director of weather strategy, told BuzzFeed News. “So weather is a huge impact on retail and has been forever.”

Walsh is one of 160 meteorologists working for IBM, which owns the Weather Company, to analyze and forecast the weather.

Increasingly, Walsh’s job is focused on how forecasts will affect retail sales as people frequently turn to their smartphones for the weather forecast. That process has become “jacked up on steroids,” said Walsh, as people also share their weather experiences on Instagram, Facebook, and Twitter, which may lead people to shop ahead of a storm, or plan on staying inside and shopping online, or buy movies on demand from a video-streaming service.

@nagoh / Via instagram.com

“The only reason people check the weather forecast is because you’re planning your life, what you’re going to buy, where you’re going to go, and where you’re going to spend your time,” said Walsh. “When you overlay the weather forecast on that, you can get a predictive sense for what people are going to be wanting and needing. You have to make sure you’re going to have enough of it.”

Add in social media and “all of a sudden these weather events become really significant drivers of retail sales before storm hits,” he said.

Bill Kirk, CEO of Weather Trends International, told BuzzFeed News that this year’s frigid winter has him bullish on winter retail sales. The company even tries to prepare annual weather outlooks for the year ahead.

“The cold snap at the beginning of the quarter is important because it drives sales,” he said. “They’re selling that at full price so it helps the supply chain.”

@afemmeinnyc / Via instagram.com

While the warm winter of 2016 led retailers to dramatically mark down coats, sweaters, and scarves, Kirk said the fall and winter of 2017 and 2018 will be exceptional for retail and seasonal merchandise sales. For the eastern half of the country, the November-through-January period so far has been the coldest and snowiest in seven years, which allows stores to sell their winter wear at full price.

The forecast for spring shopping, however, isn’t as optimistic. The winter’s freezing temperatures, which are expected to last through the early spring, may not bode well for sales. “Q4 is extremely strong, but Q1 is going to stink it up,” said Kirk.

@emsfun1 / Via instagram.com

While retailers work with companies like Kirk’s, shipping companies like UPS have their own in-house teams of meteorologists dedicated to making sure purchases get to people on time.

Randy Baker, a UPS meteorologist, told BuzzFeed News that having an on-staff weatherman is critical for making sure planes can take off in freezing temperatures on time.

“With a thunderstorm hitting, and you’re trying to land 100 aircraft in two and a half hours, that’s a huge operational impact,” said Baker. “We try to fine tune that timing. We plan the arrival time so there is minimal disruption.”

Baker’s team is staffed 24 hours a day during the work week and they’re on call during the weekends. During Thursday’s storm, Baker was briefing UPS teams on the East Coast every six hours about how the storm was progressing.

“It’s one of those things where people don’t think about what we do until a storm hits,” he said. “But we’re constantly looking at operations throughout the globe.”

Target And Walmart Stores Are Turning Into Mini Distribution Centers To Compete With Amazon

A Holiday Online Shopping Boom Led To Record-Breaking Returns

Getty Images/Matt Cardy

Now that the holidays are over, people are returning the unwanted sweaters, toys, and electronics they were gifted. And a year after more people opted to do their holiday shopping online, UPS said it expects to ship more returns back to retailers than ever before: about 1.4 million on Wednesday alone. That’s an 8% increase from UPS’s busiest day for returns last year.

The returns are part of the 750 million packages UPS projects that it delivered between Thanksgiving and New Year’s Eve — a growth of nearly 40 million packages from 2016, according to UPS. These numbers account for just a part of all online purchases that shipping companies processed this year. USPS, for example, expected to deliver 850 million packages this holiday.

“While the day after Christmas used to be reserved for long return lines at department stores, the growth of e-commerce has changed when and how consumers return gifts,” Alan Gershenhorn, UPS chief commercial officer, said in December. “A customer-friendly returns program is now an essential part of any successful e-commerce program.”

The convenience of online shopping, as well as easy return policies at stores like Costco, Target, and Walmart, encouraged more than 64 million people to shop both online and in stores during Thanksgiving weekend, according to the National Retail Federation, the retail industry’s trade organization. And more than 58 million shopped only online over Thanksgiving and Cyber Monday weekend, which is about one-third of a total of 174 million people who shopped that weekend.

Just ahead of the 2017 holiday season, Amazon honed its return policies to make it easier for customers to get a refund from the marketplace’s third-party merchants without ever returning the item or notifying the seller. This automatically issues a refund to a shopper without requiring them to ship an item back to the seller. The new return policy sparked ire among Amazon’s third-party sellers, but gave it an edge over Walmart.com and other competitors who do not offer returnless refunds. A June UPS survey found that 79% of respondents said free shipping on returns is important when selecting an online retailer, along with an easy-to-return online experience and a no-questions-asked policy.

E-commerce returns vary, accounting for 25% of all goods bought online, or even upward of 50% for apparel, according to Optoro, a reverse logistics company that works with online retailers. Optoro predicts about $90 billion in goods will be returned this holiday season. The National Retail Federation estimates shoppers will have spent between $678.75 billion and $682 billion during the 2017 holiday season.

But easy returns for shoppers create problems for retailers. While half of returns are reshelved to be resold, about 5 billion pounds of returned goods end up in landfills, according to Optoro.

Ann Starodaj, who leads Optoro’s sustainability program, said many retailers have a legacy system that can closely track new merchandise. But they hit a snag when it comes to reverse logistics, or the system that sorts out what to do with a mountain of returns after the holiday season.

“It’s messy,” said Starodaj. “It’s ‘Oh crap, you bought a hat and you bring it back in, and it looks perfectly fine. But we’re not selling this hat anymore; it’s not on the floor.’”

In many cases, Starodaj said it’s cheaper for retailers to send returned products to a landfill instead of sorting through merchandise to determine what can be resold.

Companies like Patagonia and Best Buy, which charges a 15% restocking fee on some opened items, have started to offer used and returned items on their websites, which Starodaj said is a solution to cutting down on landfill waste.

But the industry has a long way to go to make its returns process more sustainable, said Starodaj.

“A lot of focus has been on upstream how products are made, like Target removing chemicals from its products, and how they’re transported,” she said. “But there is a growing downstream issue because there’s clearly a big opportunity to make sure items stay out of landfills for long as possible.”

LINK: This Is Where All Your Online Shopping Returns End Up

LINK: Target And Walmart Stores Are Turning Into Mini Distribution Centers To Compete With Amazon

LINK: Small Online Retailers Were The Big Winners Over Black Friday Weekend


Mark Wilson / Getty Images

The Education Department is planning to suggest new rules that would make it far more difficult for borrowers to obtain student loan forgiveness after being defrauded by their colleges, according to drafts circulated by the department and obtained by BuzzFeed News.

The department's plan would require individual students to prove that their college intentionally deceived them — something that sparked alarm among student advocates, who argue it would push loan forgiveness out of reach for the vast majority of borrowers.

The proposal is part of the early stages of an effort by Education Secretary Betsy DeVos to rewrite the government's standards for loan forgiveness, called the "borrower defense" regulations. The proposed new rules would eventually erase regulations put in place by the Obama administration.

More than 80,000 claims for loan forgiveness are waiting for judgment by the department under the Obama-era rules. The vast majority were made by students at for-profit colleges, including tens of thousands who attended giant nationwide chains like Corinthian Colleges, ITT Tech, and the Art Institutes, which collapsed during the Obama administration.

DeVos has characterized the Obama-era version of the standards as a government handout to students — giving "free money" to anyone who "raised their hand" to claim they'd been defrauded. For-profit colleges and historically black schools, among others, said the rules made it much too easy for students to claim fraud.

Moves by the administration to raise the bar on loan forgiveness are "a good thing for American taxpayers," said Mary Clare Amselem, a policy analyst at the conservative Heritage Foundation, because taxpayers frequently shoulder the burden of providing forgiveness for federal loans when colleges have gone out of business. Obama's rules, Amselem said, "made it extraordinarily easy for any student to argue that because they didn't get the education they expected from their college, they were somehow defrauded."

At the core of the Trump administration's proposal, according to the drafts, is a requirement that each student provide "clear and convincing" evidence that their college "acted with intent to deceive," or a "reckless disregard for the truth" — a far higher bar than the one set by the Obama administration, which asked only for a "preponderance of evidence" that a student had been deceived, and required no proof of a school's intent.

"It's hard to picture how any student would be able to meet such a high bar," said Clare McCann, who works on higher education policy at the left-leaning New America foundation and helped write the Obama administration's original standards.

Students "don't have access to the information and internal documents you would need" to prove colleges intentionally deceived them, McCann argued. "It's setting the standard so that it's virtually unusable for everyone."

Amselem, of the right-leaning Heritage Foundation, said the Trump administration's suggestions appear "reasonable," rather than burdensome. "Requiring proof of intent is something we see elsewhere in our legal system," she said.

The new version proposed by DeVos's department appears to also slice away paths for forgiveness now available to students, like the ability to claim a college had breached its contract or use a court judgment obtained by another student, and would cut in half the time frame that borrowers have to file claims, from six years to three.

The proposals, which will soon be formally published by the department, are part of a lengthy process called "negotiated rulemaking" that is required of government agencies who are creating new regulations. They will be debated next week and could change significantly before being finalized.

Doug Mills / The New York Times / Redux

Like many talking points of this administration, the “assault” on the phrase “Merry Christmas” seems like a petty and unimaginative persecution fantasy. And yet, our president recently declared victory in the war on Christmas, giving himself credit for the win, tweeting, “People are proud to be saying Merry Christmas again. I am proud to have led the charge against the assault of our cherished and beautiful phrase. MERRY CHRISTMAS!!!!!”

And his supporters have praised his victory, with Fox’s Todd Starnes and prominent evangelical Franklin Graham publicly thanking him for putting Christ back in Christmas. But for many Americans, this all feels like we are living in some alternate reality. Has there really been a war on Christmas going on all this time without our witnessing it? How can so many people be convinced that there was an “assault” on a phrase? Where was all this happening? Who were the casualties of this war? What did Trump actually do to stop this “assault”?

If you share this confusion, the temptation is to write off Trump’s rhetoric and move on. But that response doesn’t address the question of why this rhetoric is so effective. What is it about Trump’s promise to bring back “merry Christmas” that has resonated with so many Americans? Even if it seemed absurd to talk about bringing a phrase back — a phrase that was never banned in any meaningful sense — it wasn’t absurd to many of our neighbors. Instead, his promise served as both a relief and a validation. Why?

On the surface, the conflict is over retailers using “happy holidays” instead of “merry Christmas” in their advertising, in-store signage, and greetings. But it’s about so much more than that. Even as President Trump worked the campaign trail, he promised, "If I become president, we're all going to be saying, 'Merry Christmas' again. That I can tell you." What he’s been promising all along is a national vocabulary change. Specifically, one that moves away from phrasing often perceived to be more politically correct and multicultural to one that refers to one faith’s holy days: Christianity, the founding faith of our country, according to many Trump supporters.

Still, if Trump’s supporters are concerned about our national identity turning from its Judeo-Christian roots, it does seem like season’s greetings are a trivial place to resist this change. Shouldn’t they be more concerned about shifting beliefs and values than language? Consistently, when conservative pundits decry the use of “happy holidays” in our public discourse, their argument is that the change in language is really part of a larger assault on western civilization, Judeo-Christian values, or “our” way of life. “Merry Christmas” doesn’t stand for a celebration of the incarnation (the religious meaning) or Judeo-Christian values in a politically correct society (the culture war meaning), it replaces those meanings.

According to Snopes, the earliest modern use of the phrase “war on Christmas” is traced back to a post on VDARE, a white supremacist website in December of 2000. In the article, the author calls the “war on Christmas” “part of the struggle to abolish America.” In 2005, Bill O’Reilly framed the “war on Christmas” as a secular plot:

All over the country, Christmas is taking flak. In Denver this past weekend, no religious floats were permitted in the holiday parade there. In New York City, Mayor Bloomberg unveiled the holiday tree and no Christian Christmas symbols are allowed in the public schools. Federated Department Stores, [that's] Macy's, have done away with the Christmas greeting, "Merry Christmas."

Now, all of this anti-Christian stuff is absurd, and may even be a bias situation. But the real reason it's happening has little to do with Christmas and everything to do with organized religion.

Secular progressives realize that America as it is now will never approve of gay marriage, partial birth abortion, euthanasia, legalized drugs, income redistribution through taxation, and many other progressive visions because of religious opposition.

But if the secularists can destroy religion in the public arena, the brave new progressive world is a possibility.

Now most people, of course, love Christmas and want to keep its traditions, but the secular movement has influence in the media, among some judges and politicians. Americans will lose their country if they don't begin to take action. Any assault on Judeo-Christian philosophy should be fought.

Notice that O’Reilly lumps in religious floats and Macy’s use of “merry Christmas” alongside opposition to abortion as part of “Judeo-Christian philosophy.” If we let the secularists say “happy holidays,” soon it will not be socially acceptable to oppose abortion and support traditional marriage.

O’Reilly was wrong about the causal relationship between a season’s greeting and the achievement of progressive goals, but I think he hints at a truth here: Social acceptability, which is shaped by the media and marketplace, largely defines our political discourse. In place of debating the substance of a political position, we resort to signaling, shaming, hashtagging, and posturing. And many Trump supporters believe that they have long been on the losing end of these conflicts, making their views socially unacceptable. “Merry Christmas” is an opportunity to win something back.

This year, President Trump strongly echoed O’Reilly at the Values Voter Summit. After listing several ways he was fighting for religious liberty, Trump said:

We are stopping cold the attacks on Judeo-Christian values. ... And something I’ve said so much during the last two years, but I’ll say it again as we approach the end of the year. You know, we’re getting near that beautiful Christmas season that people don’t talk about anymore. They don’t use the word “Christmas” because it’s not politically correct. You go to department stores, and they’ll say, “Happy New Year” and they’ll say other things. And it will be red, they’ll have it painted, but they don’t say it. Well, guess what? We’re saying “Merry Christmas” again.

Getting people to say “merry Christmas” is part of “stopping cold the attacks on Judeo-Christian values.” Yet, when Trump declared victory earlier this month, there was no hint of these deeper meanings: “I am proud to have led the charge against the assault of our cherished and beautiful phrase. MERRY CHRISTMAS!!!!!” The assault was on the phrase, not what it represented.

The irony of making a phrase the battleground for deep cultural conflict is that, almost inevitably, the substance of the conflict fades in the background, leaving you with a “cherished and beautiful phrase.” As a conservative Christian, I could care less about the phrase “merry Christmas,” but I do care very much that the incarnation of Christ is the story of Christmas, and whatever secular trappings have been added to the holiday are trivial in light of this truth.

As far as I’m concerned, the phrase shouldn’t be the subject, but for Trump, and for many people, it is. And what matters most of all is that more people are saying the phrase. What matters is that retailers use it in their advertising and require their employees to say it to customers. What matters is that people can say “merry Christmas” to strangers without worrying about offending people, because it has become politically correct.

All of this may sound absurd, until you consider the nature of politics, identity, and branding in 2017. Then, it is still absurd, but it is part of a much larger absurdity at the center of our public discourse. Inspired by marketing and social media, and motivated by a desire to establish our identity in the world through expression of preferences, American politics is dominated by hollow rhetoric. Identifying ourselves with a trending, politicized, tribal phrase feels more important than making a substantive argument in public, or believing in a particular political principle. And in this shallow public discourse, frequency and popularity — “political correctness” — has more weight than truth. What matters most is winning the cultural war, even if we are just fighting over words whose meanings have faded long ago.

When Trump supporters cheer him on for reclaiming “merry Christmas,” they are cheering because they believe that his influence has been enough to make the phrase popular again, and since that phrase represents them, they in turn become more socially acceptable. It doesn’t really matter that former president Barack Obama regularly said “merry Christmas” or that saying it was never actually politically incorrect. What matters is that it feels like the phrase is socially acceptable again, and in our political climate, there is something very affirming about holding the proper view.

The tragedy of all this for me, as a Christian, is that in trying to defend Christmas from secularism, the “war on Christmas” pundits have only politicized and secularized Christmas further. But the only meaningful answer to all of this is to insist on substance, to produce and engage political discourse that goes beyond memes and rhetoric to substantive debate.

Alan Noble is editor-in-chief of Christ and Pop Culture, a professor, and author of the forthcoming book Disruptive Witness.

Twitter

When Twitter debuted its timeline algorithm in February 2016 — which inserts older tweets into your timeline that Twitter thinks you'll like — it promised users the feature would be optional, telling them they could "easily turn it off in settings."

But nearly two years later, it's still impossible to get old tweets off the top of your timeline.

Here's why: While Twitter built an opt-out toggle — available in settings under "Show the best Tweets first" — you'll still see plenty of old tweets in the "In case you missed it" box, which you cannot turn off. Also, old tweets still appear at the top of your timeline when people you follow like them.

In addition to being unpopular with some users, the insertion of old tweets into a timeline can disrupt the fast flow of information that makes Twitter a critical tool during breaking news events and disasters.

Examples of algorithmically inserted tweets that still show up even when "show the best tweets first" is turned off.

Twitter

Twitter did not respond to a request for comment. It has previously stated its new timeline algorithm is working, citing it as a reason for revenue and engagement growth, and noting that less than 2% of people have opted out.

Still, there's a vocal group of Twitter users who prefer to see the newest tweets up top, and can't stand the fact that Twitter won't let them ignore outdated but popular tweets.

Twitter

Twitter

Twitter

BuzzFeed News was alerted to this frustration after publishing a story about an algorithm test that inserted very old tweets into people's timelines. That story noted the existence of an opt-out option, but users responded saying they'd ticked it off with no success.

Twitter

Twitter

Twitter says little about how frequently it inserts algorithmically selected tweets into its timeline, making it difficult to determine if these features are appearing more often.

Twitter

Twitter Tested, And Scrapped, An Algorithm That Filled Timelines With Very Old Tweets

A Year In Twitter Missteps And Apologies

23 Of Our Favorite Business Stories Of 2017

by Venessa Wong

Amazon swallowed retail, massive hacks turned privacy into a joke, food was bad, RiRi was good, and everyone sued Betsy DeVos. Oh, what a year!

Pearl Parties Are Taking Over Facebook Live, But Buyer Beware

Pearl Parties Are Taking Over Facebook Live, But Buyer Beware

Allison Dickson

Meet The "Young Saints" Of Bethel Who Go To College To Perform Miracles

Meet The "Young Saints" Of Bethel Who Go To College To Perform Miracles

Max Whittaker for BuzzFeed News; Lettering by Madelene Wikskaer / BuzzFeed News

People Are Saying Starbucks' New Holiday Cup Is Totally Gay

People Are Saying Starbucks' New Holiday Cup Is Totally Gay

BuzzFeed News

Airlines Treat You Badly Because They Can

Airlines Treat You Badly Because They Can

Lixia Guo / BuzzFeed News

How One Generation Changed The Way We Think About Furniture

How One Generation Changed The Way We Think About Furniture

Jared Oriel for BuzzFeed News

RiRi's New Makeup Line Brings New Shades To Sephora

RiRi's New Makeup Line Brings New Shades To Sephora

Inez and Vinoodh/Fenty Beauty

How America's Student Loan Giant Dropped The Ball

How America's Student Loan Giant Dropped The Ball

Google Earth

How Fashion Nova Built An Entire Fashion Company Completely On Instagram

How Fashion Nova Built An Entire Fashion Company Completely On Instagram

Courtney Menard for BuzzFeed News

There's A Fight Brewing Between The NYPD And Silicon Valley's Palantir

There's A Fight Brewing Between The NYPD And Silicon Valley's Palantir

Matt Chase for BuzzFeed News

People Are Losing A Bunch Of Money From These Scams On Amazon

People Are Losing A Bunch Of Money From These Scams On Amazon

Loic Venance / AFP / Getty Images

There's A Wild Fight Being Waged Over Organic Chickens

There's A Wild Fight Being Waged Over Organic Chickens

Leon Neal / Getty Images

The SEC Just Fined A Unicorn Startup For The First Time

The SEC Just Fined A Unicorn Startup For The First Time

Steve Jennings / Getty Images

For A Glimpse At The Billionaire Class, Check Out Betsy DeVos's Finances

For A Glimpse At The Billionaire Class, Check Out Betsy DeVos's Finances

Photo Illustration by BuzzFeed News; Getty Images

Their Home Was In Foreclosure. Then It Was Sold On Reality TV.

Their Home Was In Foreclosure. Then It Was Sold On Reality TV.

Peter Gamlen for BuzzFeed News

Asians With “Very Familiar Profiles”: How Princeton’s Admissions Officers Talk About Race

Asians With “Very Familiar Profiles”: How Princeton’s Admissions Officers Talk About Race

Daniel Hulshizer / ASSOCIATED PRESS

Betsy DeVos Is Being Sued By 17 States Over For-Profit College Rules

Betsy DeVos Is Being Sued By 17 States Over For-Profit College Rules

Darron Cummings / AP

Airbnb's Mega Hosts Are Turning It Into Just Another Travel Booking Site

Airbnb's Mega Hosts Are Turning It Into Just Another Travel Booking Site

Airbnb

Chipotle Can't Seem To Get Its Customers Back

Chipotle Can't Seem To Get Its Customers Back

Christine Chau / Via Flickr: 64190947@N03

Your Fidget Spinner Is Reshaping The Retail Industry

Your Fidget Spinner Is Reshaping The Retail Industry

AP/Carlos Osorio

"Not Safe For Celiacs" — Gluten-Free Cheerios Are Still Drawing Complaints

"Not Safe For Celiacs" — Gluten-Free Cheerios Are Still Drawing Complaints

Thomas Heyman / Via Flickr: thomaaas

Hard Lessons: Putting Troubled Kids In Strict Environments Is Big Business For Camelot Education

Hard Lessons: Putting Troubled Kids In Strict Environments Is Big Business For Camelot Education

Carlo Giambarresi for BuzzFeed News

A Farewell To The Father Of The Latte

A Farewell To The Father Of The Latte

F Bohac / Via Flickr: fbohac

Mark Wilson / Getty Images

Ohio on Friday banned doctors from performing abortions after a fetus receives a diagnosis of Down syndrome, in a move some anti–abortion rights advocates are cheering and abortion rights advocates are decrying.

Republican Gov. John Kasich signed the legislation into law on Friday, leading into a long holiday weekend. Doctors who knowingly violate the ban in Ohio could risk losing their medical licenses and face felony charges.

The law takes effect in 90 days. Two other states, Indiana and North Dakota, have passed similar laws.

The ban "prohibits a person from performing, inducing, or attempting to perform or induce an abortion on a pregnant woman who is seeking the abortion because an unborn child has or may have Down Syndrome," according to a press release from the governor's office.

Some disabilities rights advocates favor the bans. The head of the Ohio Right to Life organization has said, "Every Ohioan deserves the right to life, no matter how many chromosomes they have."

In response to the bill's signing Friday, the national anti–abortion rights group Susan B. Anthony List said in a statement, "Ohio has given unborn children with Down Syndrome and their families an early Christmas present and created a safe haven from lethal discrimination."

Others say the bans infringe on women's autonomy over their bodies and reproductive choices.

“When a woman receives a diagnosis of Down syndrome during her pregnancy, the last thing she needs is Governor Kasich barging in to tell her what’s best for her family," said NARAL Pro-Choice Ohio Executive Director Kellie Copeland in a statement. "This law shames women and will have a chilling effect on the conversations between doctors and patients because of the criminal penalties that doctors will face."

In Indiana, a federal judge blocked the law on grounds that the state does not have the right to limit women’s reasons for terminating a pregnancy.

NARAL Pro-Choice Ohio argues the new law signed by Kasich is unconstitutional on the same grounds.

"The law does nothing to support families taking care of loved ones with Down syndrome," Copeland said. "And instead exploits them as part of a larger anti-choice strategy to systematically make all abortion care illegal.”

The North Dakota law has not been legally challenged.

The Graduate Student Tax Was Dropped From Republicans' Final Bill

by Molly Hensley-Clancy

Shannon Stapleton / Reuters

The final version of the Republican tax bill won't increase taxes on graduate students who get breaks on their tuition, a provision from an earlier bill that sparked a nationwide uproar from students who said the proposal would unfairly tax them on money they never saw.

The provision in the tax legislation passed by the House would have counted graduate students' "tuition waivers" as income, dramatically driving up their tax bills. A student pocketing less than $20,000 from a school stipend, typical of those in graduate programs, would have suddenly found themselves paying taxes on $50,000 or $60,000 in income.

But the provision, which wasn't in the version of the bill the Senate passed earlier this month, was struck from the final compromise version, released Friday. So was another controversial provision from the House's version, which would have repealed a tax deduction for interest paid on student loans.

Republicans plan to vote for the bill in both the House and Senate next week.

In protests nationwide at more than 40 colleges, graduate students, professors, and higher education leaders argued the House's bill would have transformed graduate education, making it unaffordable particularly for low-income students.

"The fact that thousands of graduate students across the country got engaged in this is an enormous statement about how important they saw this as," said Steven Bloom, the director of government relations at the American Council on Education (ACE), an industry group. "I have to give them enormous credit — they took the bit and ran with it."

Higher education industry groups like ACE, which are powerful forces in Washington, lobbied intensely to convince lawmakers not to tax tuition waivers, saying that schools would also be forced to admit fewer graduate students, and that undergraduates, too, would suffer. "Its ripple effects were enormous," said Bloom.

The final tax bill keeps one provision that had stoked controversy among higher education leaders, imposing a tax on the endowments of some rich nonprofit colleges, a provision conservatives argued would raise revenue from elite schools with billions of dollars in assets.

Alex Wong / Getty Images

The Republican tax bill, which would overhaul the tax system to vastly reduce the tax rates paid by corporations permanently and temporarily cut taxes for many normal taxpayers, has reached its final form, with the House and Senate agreeing on a bill that they plan to vote on next week.

The conference bill that came out of negotiations between the two chambers is broadly similar to the legislation that passed the Senate at the beginning of the month. Two of the most significant changes from either original bill are the income tax rates paid by wealthy individuals and how generous the child tax credit is.

The original House bill reduced the current seven income tax brackets to four, with the top rate staying at 39.6%, while the bill passed by the Senate cut the top rate to 38.5%. The conference bill slashes the top rate to 37% and has that rate kick in at $600,000 for joint filers and $500,000 for single filers, compared to the current cutoff at a bit over $400,000 for single filers and $480,000 for joint filers.

The combined bill also puts the corporate tax rate at 21%, while the first House and Senate legislation put it at 20%, down from the 35% rate today.

Many of the controversial provisions in the House bill, like eliminating the tax credit for adoptive parents or getting rid of the ability of graduate students to waive their tuition from their taxable income, were stripped out of the conference bill.

And after a brief scare for leadership this week, the bill is now virtually certain to pass the Senate, after getting 51 of 52 possible Republican votes and with no Democrats supporting it the first time.

On Thursday, Sens. Marco Rubio and Mike Lee said there were respectively opposed to or undecided on the bill if it didn't include a more generous child tax credit for low-earning parents.

To address those concerns, the new bill includes the original Senate bill's boost of the tax credit per child up to $2,000, but it makes $1,400 of that "refundable," meaning it gets paid to parents even if they have no income tax liability. The original Senate bill made only $1,100 of the credit refundable.

Rubio, in response, declared his support for the bill Friday, and Lee's spokesman said that the senator would "hopefully" support the bill and was encouraged by the work done in the conference to beef up the child tax credit.

Another key senator, Bob Corker, the only Republican to oppose the original Senate bill, also said Friday he would vote for the conference version. Corker voted against the original bill because he was concerned over how much it would add to the deficit, and he did not say if the new bill specifically changed to address those concerns.

Sens. Susan Collins and Jeff Flake, who both supported the first bill in the Senate, have not yet said how they will vote on the combined bill. They could both oppose it however, and the bill could still pass with Vice President Mike Pence casting a tie-breaking vote.

This is Part Three of a BuzzFeed News investigation.
Part One: Secrets Of One Of The World's Dirtiest Banks And Its Powerful Western Protectors
Part Two: Kremlin-Linked Slush Funds Funnelling Money To Syria's Chemical Weapons Financiers

Deutsche Bank facilitated hundreds of millions of dollars of transactions for a corrupt Cyprus bank that served as a hub for illicit money from “the darkest corners of the criminal underworld”, a trove of secret documents obtained by BuzzFeed News reveals.

Deutsche – and its New York subsidiary under scrutiny for its loans to Donald Trump – provided a crucial bridge between FBME Bank and the global financial system, acting as its longstanding correspondent bank in the US and helping some of its most nefarious clients move illicit money into the West.

FBME was banned from using the dollar this year after losing a protracted legal battle with the US government – three years after the Financial Crimes Enforcement Network, known as FinCEN, first moved to stop the bank sending “dirty funds through the U.S. financial system”.

FinCEN kept much of its evidence against FBME secret – but the files obtained by BuzzFeed News have exposed the Cyprus bank as a major conduit for funds linked to terrorism, organised crime, and chemical weapons, and revealed how blue-chip Western institutions enabled its activities. In recent days we disclosed how FBME’s ultra-powerful international law firms – including an attorney playing a key role in the Trump-Russia investigation – crusaded for the bank while accountants at two of the world’s biggest accounting firms signed off its activities, and we exposed a network of Kremlin-linked slush funds inside FBME funnelling money to shadowy people fronting for Syria's chemical weapons programme, organised crime, and ISIS.

The revelations have prompted calls from politicians and campaigners for a crackdown on corrupt institutions in money laundering hotspots such as Cyprus – and the enablers that act as their gateway into the West. Ian Austin, a British member of parliament, said “BuzzFeed's investigation provides even more evidence of illicit funds flowing through Cyprus” and called on the UK government to act swiftly to shut “criminals and stolen money” out of the financial system. Transparency International called for a “drastic overhaul” of financial regulations to hold bankers, lawyers, and accountancy firms to account for their role in enabling corrupt banks implicated in money laundering.

Banks operating in the US are required by law to take steps to ensure that the money they channel into the American financial system is clean. The documents do not suggest Deutsche Bank knowingly facilitated illegal activity – but they raise questions about how the banking giant processed hundreds of millions of dollars connected to some of the world’s worst scourges without spotting enough cause for suspicion to sever ties with FBME.

Got a tip? You can email tips@buzzfeed.com. To learn how to reach us securely, go to tips.buzzfeed.com.

Deutsche carried on approving the Cyprus bank’s dollar transactions for decades even as red flags piled up and another Western banking giant cut ties. It withdrew its services with “extreme regret” only after the US government accused FBME of facilitating money laundering for “weapons proliferators, terrorists, and transnational organized criminals” in 2014.

Deutsche Bank first scheduled a conference call to discuss detailed questions from BuzzFeed News, but cancelled at the last minute and instead sent a short statement: “We severed our relationship with FBME in 2014 and have added more than a thousand anti-financial crime staff in recent years to make our business safer and increase our controls.” The bank declined to answer specific questions, citing client confidentiality.

The documents show:

  • Deutsche processed hundreds of millions of dollars of suspicious transactions for FBME clients – including a Kremlin-linked network of Russian slush funds funnelling money to financiers of the Syrian regime and a businessman trading oil with ISIS.

  • The German giant was kept in the dark about the true owners of suspicious FBME accounts whose transactions it was authorizing – despite requirements for correspondent banks to perform additional checks when signs of money laundering arise.

  • Deutsche continued to facilitate suspicious transactions for FBME even after staff repeatedly raised questions about some of the Cyprus bank’s most sinister Russian accounts.

  • A top executive charged with preventing money laundering at Deutsche privately told FBME that US law enforcement was probing its accounts and asked an executive to “please refrain” from discussing the situation in writing to avoid giving the “wrong impression”.

  • Deutsche showered FBME with “Processing Excellence” awards for at least four straight years before the bank was named as a “primary money laundering concern” by the US government.

The revelations about Deutsche’s dealings with FBME will likely bring the German banking giant under renewed scrutiny as it struggles to rebuild a reputation damaged by a series of major scandals and fends off questions about its relationship with Trump. Deutsche has been hit with billions of dollars of fines in recent years for evading sanctions, manipulating lending rates, and selling toxic mortgages in the buildup to the financial crisis – paying a further $630 million to regulators earlier this year for failing to prevent a vast money laundering scheme led by rogue traders in its Moscow office.

The German banking giant is struggling to repair its reputation after a slew of scandals.

Bloomberg / Getty Images

Deutsche has faced questions over why it lent Trump more than $600 million at a time when other Wall Street banks had frozen him out. The bank was reportedly subpoenaed by special counsel Robert Mueller, who is apparently investigating the US president’s finances alongside his campaign’s contacts with Russia.

When it moved to shut FBME out of the American financial system in 2014, FinCEN accused FBME of actively promoting its weak anti-money laundering controls “in order to attract illicit finance business from the darkest corners of the criminal underworld”. Only then did Deutsche finally stop facilitating its transactions.

The US government followed up by issuing sanctions against FBME and several of its clients for laundering funds for terrorists, narcotics traffickers, and organised crime – as well as funnelling money into the Syrian chemical weapons programme. FBME’s owners, Fadi and Farid Saab, told BuzzFeed News in statements via their lawyers that FinCEN was “misled” into unfairly treating the bank by “corrupt individuals within corporate and state bodies”. “FinCEN have never released the classified evidence they were supposedly relying on, and their allegations have never been tested in any court,” Farid Saab said in an additional statement.

Yet the FBME files lay bare the extent of Deutsche’s intimate dealings with a Cyprus bank awash with dirty money.

Established by the Saabs in the early ’80s, FBME offered all the trappings of a modern offshore banking sanctuary to its legions of clients in Russia and other money laundering hotspots around the globe. It had the palm-lined island base in the Cypriot city of Nicosia, the network of shady shell-company fixers, the militant secrecy, and the lax approach to preventing money laundering.

But to truly thrive, FBME had to give its customers something else they craved: access to American dollars. For that, FBME needed a willing partner in the US. It found one in Deutsche Bank and its New York subsidiary DBTCA.

Many of the world’s smaller banks, such as FBME, don’t have direct access to the dollar, the lifeblood of global finance, so they route payments through bigger “correspondent banks” that clear the transactions.

To FBME, which did around two-thirds of its business in dollars, this was critical. “There was nothing more valuable to the bank than the dollar correspondent bank in New York,” a former high-ranking employee told BuzzFeed News.

FBME based its offices in Nicosia, Cyprus.

Alamy Stock Photo

Two other smaller correspondent banks, Germany’s Commerzbank and Austria’s Raiffeisen, were also able to clear dollars for FBME. (Both declined to comment to BuzzFeed News.) But Deutsche’s status as a global banking behemoth and its large presence on US soil gave FBME credibility, especially with its bigger clients. “Only Mickey Mouse banks don’t have dollar correspondents in the States,” the former employee said.

Deutsche got paid for the dollar transactions it cleared for FBME, but in doing so it exposed itself to legal risk. FinCEN requires correspondent banks to ensure they do not process illicit funds for their foreign partners, meaning they must “assess the money laundering risk posed” by the transactions they process and perform checks to understand the origin of the funds in any accounts that raise red flags.

That, according to a US government source, was the German giant’s major weak spot. “Deutsche is crap for clearance,” the source said. “They know their own customers, but they don’t pay any attention to their correspondent banking.”

A core principle in the world of money laundering prevention holds that banks must find out who truly controls the money in their accounts, known as the “ultimate beneficial owner”, or UBO. But documents show that FBME held back the true identities of clients whose transactions it was facilitating from Deutsche.

Controversial banking secrecy laws in Cyprus allowed FBME to shield its account owners from external scrutiny unless compelled to reveal their identities by a court order. But Deutsche was required by US law to satisfy itself that any funds it processed into the American financial system came from a legitimate source. It didn’t have a “routine obligation” to establish the identities of all FBME’s clients, but if there was any sign of a higher risk of money laundering, Deutsche was required by the US government to carry out further due diligence.

Emails obtained by BuzzFeed News reveal that on several occasions Deutsche staff requested information about the owners of FBME accounts as part of the “global effort against money laundering” but were repeatedly rebuffed.

One of the accounts Deutsche repeatedly raised concerns about was a company called Balec. Employees began emailing FBME as far back as 2007 to request information about the true owner of the Moscow-based firm, explaining that they had a responsibility to determine whether the company’s dollar transactions had “a lawful purpose”. But FBME’s compliance team refused to play ball. A senior executive told Deutsche that the Cyprus bank had conducted its own due diligence to confirm that the true owner of Balec was a law-abiding citizen – and stated that “only on production of a court order” would the bank “breach” Balec’s confidentiality by disclosing his identity.

“With regard to the global effort against money laundering, we would appreciate if you could provide us with further information.”

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