When imagining how dirty money is moved around the country, "think of FedEx," says Joseph Burke, chief of the National Bulk Cash Smuggling Center in Vermont. The center is tasked with tracing the sometimes elaborate path of drug proceeds from point-of-sale to the bank teller's window.
Unscrupulous financial institutions, legislative delays and a lack of quick action by U.S. federal officials are allowing drug cartels to wash money in the United States "right before our eyes," according to Terry Goddard, the former Attorney General of Arizona.
Personally letting law enforcement agents know about clients' questionable activity can be crucial to identifying money launderers, according to Hector Colon, unit chief of the Illicit Finance and Proceeds of Crime Unit of Homeland Security Investigations at U.S. Immigration and Customs Enforcement.
Securities transactions are increasingly being used by South American drug traffickers to launder illicit proceeds, says Manny Muriel, an attaché in the Internal Revenue Service's (IRS) Bogota, Colombia office.
Senators chastised the U.S. Treasury Department Wednesday for delays in regulating prepaid access products that can be used to smuggle drug proceeds from the United States into Mexico.
Several banks are asking the U.S. Treasury Department's financial crimes bureau for the unthinkable: more anti-money laundering compliance responsibilities.
The U.S. Treasury Department will miss a Feb. 22 deadline set by Congress to implement rules subjecting stored value cards to the Bank Secrecy Act, according to consultants and bank lobbyists.
The U.S. Treasury Department remains on schedule to issue regulations early next year that will bring stored-value cards under the purview of the Bank Secrecy Act, according to a government official.
Merchants and automatic teller machines that help customers reload stored value cards do not necessarily qualify as money services businesses subject to anti-money laundering regulations, the U.S. Treasury Department said.
Because AML regulation for cards is "unclear," they "provide an ideal laundering instrument to anonymously move monies associated with all types of illicit activity, without fear of documentation, identification, law enforcement suspicion, or seizure," according to a federal government report.
Stored value cards, which can be obtained with virtual anonymity and are emerging as a cash alternative for millions of unbanked consumers, have been identified as an emerging money laundering threat by the U.S. government in a new report.