Long considered one of the toughest illicit finance schemes to crack, trade-based money laundering is on the rise in response to stricter regulatory oversight of financial institutions, U.S. investigators said Monday.
Trade-based schemes and bulk cash smuggling are among the most common tactics used by international money launderers, according to Joseph Gallion, the deputy assistant director of the Financial, Narcotics and Special Operations Division for the Homeland Security Investigations (HSI).
Three recently adopted international treaties drafted to foster trade between the Americas and Europe will also make it easier for financial criminals to launder money, say attorneys and former investigators.
Officials are concerned that Iran may have "sleeper cell" agents in the Arabian Peninsula conducting financial transactions and preparing potential retaliatory action for the Persian country, according to a professor at the Monterey Institute of International Studies.
The U.S. Treasury Department's financial intelligence unit issued guidance Thursday on how to spot and report transactions tied to trade-based money laundering, a type of crime on the rise.
Though headlines are focused on the subprime mortgage crisis and recessionary fears, criminals are still finding ways to launder funds, including through trade-based finance , says Elaine Carey, Senior Vice President and National Director of Control Risks, an independent risk consultancy office.
The United Kingdom may turn over trade data to U.S. officials in exchange for access to a U.S. computer system designed to detect trade-based money laundering, according to the British customs service.
Mexico and the United States will create a joint trade intelligence organization to collect and analyze data on the movement of goods between the two countries as part of an effort to stem money laundering and fraud.
Technological developments offer governments unprecedented ability to address trade-based crime. But there's a problem, according to Nikos Passas, a professor who studies financial crime at Boston-based Northeastern University: governments aren't utilizing available tools.
Evidence that high-profile terrorist groups are increasingly seeking to move money for their operations under the guise of legitimate trade has spurred financial experts to push for greater regulation, compliance professionals say.
U.S. Immigration and Customs Enforcement official Kevin Delli-Colli spoke with Fortent Inform reporter Matt Squire on Nov. 28 about bulk cash smuggling and what banks should be looking for when it comes to trade transactions.