what causes this??

your shooting at a too slow shutter speed,
the flash captures his hand at the highest point where it is correctly exposed. Because of the slow shutter speed the hand then appears to blur because of the subject movement..

No, it's the fact that the background illumination was bright enough to register an image of the moving subjects, albeit a blurry image, at the aperture and shutter speed you selected to record the background. The flash froze the foreground image, but in the areas where the background was light enough, the motion blur of the subject was visible. Granted, you could use second curtain flash to make the blur appear to be behind the motion, but you won't be able to get rid of it entirely. You might be able to reduce it substantially with a faster shutter speed up to the sync speed of your camera or by using high speed sync on the flash at shutter speeds above the sync speed of the camera.

Looks like HSS was used. HSS is actually a burst of short flashes. What was your SS here?

AWB, 1/200 SS, f/10, ISO400, 20mm FL and yes HSS was on.

Hmmm.... at 1/200 it shouldn't have actually been using HSS (as far as I know), even if it was set to be allowed on the flash.

yeah i dunno man i figured some kind of motion blur but at 1/200 i didnt think i'd have much.

You need a faster shutter speed. HSS only kicks in faster than your camera sync speed, at 1/200th your flash will be in regular mode.

I'm a drag race photographer. I can assure you that it doesn't take all that much motion to make 1/200th of a second seem like an eternity.

Notice how the blur is only obvious against a light background. The dark background acts like a dark room in some respects.

Here is my crazy theory: At HSS you lose sync with the slower shutter speed, which causes a short burst of flash to cover the beginning of the exposure, however leading astray any extra light as the last half or quarter of the exposure time continued.

Sounds smart, so I will stick to it.. yeah, yeah.