Archive for the ‘Anti-Money Laundering. General Information’ Category

Venezuelans seeking refuge in crypto-currencies

Thursday, March 21st, 2019

Since Bitcoin first came on the scene 10 years ago, crypto-currencies have faced a lot of criticism. Some say that Bitcoin and other crypto-currencies are digital gold, while others accuse them of hiding money gained from drug and illegal weapon trafficking. But for one group of people, crypto-currencies are really very useful.

After suffering one of the worst periods of hyperinflation since World War Two, Venezuela has seen its currency rendered practically valueless. For example, a cup of coffee now costs 2,800 bolivars (28 cents), up from 0.75 bolivars 12 months ago, which is an increase of 373,233%, according to Bloomberg data. And that’s after a 2018 devaluation that knocked five zeros off the currency.

More than 3 million Venezuelans have left the country because vitally important goods have become unaffordable as well as crime has increased substantially.

As a result, many are turning to digital assets such as Bitcoin as an alternative to the Venezuelan bolivar. Taking into consideration that Bitcoin value has plunged from nearly GBP 15,000 in 2017 to less than GBP 3,000 now, it reveals how desperate people have become.

While Bitcoin may be volatile but the Venezuelan bolivar has been losing value much faster. Even the government has launched its own crypto-currency, the Petro, supposedly backed by oil, to provide a solution to the economic crisis. However, critics say that there is no evidence of anyone using it.


Former Malaysian prime minister arrested by anti-corruption agency

Tuesday, September 25th, 2018

According to anti-corruption agency’s statemenent, Malaysia’s former prime minister Najib Razak faces further charges of abuse of power over the multimillion dollar looting of a state investment fund after his arrest on September 19.

Razak was detained at its office over the transfer of 2.6 billion ringgit (£477 million) into his bank account. He will be taken to court in order to face several charges under Section 23 of the Malaysian Anti-Corruption Commission Act.

Razak was earlier charged with multiple counts of criminal breach of trust, corruption and money laundering over the scandal at the 1Malaysia Development Berhad (1MDB) state fund, just months after his shocking electoral defeat. He has pleaded not guilty and his trial is due to start next year. He set up 1MDB when he took power in 2009 to promote economic development, but the fund amassed billions in debt and is being investigated in the United States and several other countries for alleged cross-border embezzlement and money laundering. Public anger over this scandal led to the stunning ouster of Mr Razak’s long-ruling coalition in national polls and ushered in the first change of power since independence from Britain in 1957. The new government reopened investigations stifled under Mr Razak’s rule and barred him and his wife from leaving the country. Also, police seized jewellery, handbags and other valuables estimated at more than 1.1 billion ringgit from properties related to him.

Razak, 65, has accused Malaysia’s new government under prime minister Mahathir Mohamad of seeking political vengeance and vowed to clear his name at his trial. According to his claims, the money was a political donation from Saudi Arabia’s royal family.

Is BitCoin a way to launder money or a technology challenge?

Wednesday, December 20th, 2017

As Bitcoin breaks new barriers and faces new restrictions, its role and potential is being discussed all over the world.

Is Bitcoin criminal as a way to launder money and avoid paying taxes? Is it profitable as an apportunity to invest money? Is it just a bubble and will it terminate soon?

Fears over tax evasion and money laundering are pushing the European governments to regulate the Bitcoin. The EU is planning to bring cryptocurrencies into the scope of anti-money laundering and counter-terrorism legislation, meaning that traders will have to reveal their identities.

So far, during the currency’s relatively short life, it has been anonymous, making it attractive for people trading drugs and other illegal items on the so-called ‘dark web’.

The new rules could come into force within the next few months and ensure that the platforms that allow users to trade the currency have to carry out due diligence and even report any transactions that appear suspicious.

It’s a major change and one that could either be seen as a clampdown on something that’s being exploited by criminals or as a stamp of recognition that cryptocurrencies are becoming mainstream, despite the lack of a state that back up its value.

5 steps of AML compliance in 2017

Friday, March 3rd, 2017

Sven Stumbauer, Managing Director of AlixPartners, published an article on Five Steps for Anti-money Laundering Compliance in 2017.

According to the article, banks and other financial institutions entered 2017 facing an increasingly daunting framework of anti-money-laundering (AML) laws and regulations.

Having a comprehensive compliance programme in place is currently becoming more and more crucial. So, the following five steps financial institutions can take in 2017 have been outlined:






It has been also mentioned that recent AML enforcement actions pinpoint the danger of failing to recognize potential risk and respond appropriately. While the evolving regulatory landscape poses significant challenges to financial institutions, opportunities might also be present. By performing comprehensive risk assessments and establishing a culture of compliance throughout the organization, a financial institution can position itself to better recognize, identify, and avoid potential risk exposure. So, by full usage of technology solutions, it can develop a better understanding of its underlying customer base and ensure it complies with AML regulations at a lower cost.

Money Laundering in sports: Football, Gambling, and Money Laundering

Friday, May 23rd, 2014

Recently, Springer Publishing issued a title to explore football and sports as a cover for money laundering and other financial crimes. The new book is called Football, Gambling, and Money Laundering: A Global Criminal Justice Perspective. Its author Fausto Martin De Sanctis explores how sports are a robust and growing front for a number of illegal activities.

On June 12, São Paulo, Brazil begins hosts the 2014 FIFA World Cup. The event will be held the 20th time, and this is one of the largest sporting competition on worldwide. However, behind competition and the glitz, and glamor, there may be money laundering and other financial crimes taking place.

Sports is not only a path to fame for athletes, a source of national pride for fans and a past time for many, but also a convenient cover for corrupt enterprises. The book shares on how crimes take place, how they are able to flourish, what steps are currently being taken and what should be done to confront sports-related financial crimes.

As an authoritative reference on the topic, Football, Gambling, and Money Laundering will appeal to academics, law enforcement officials, judges, prosecutors and law makers alike. The book identifies possible loopholes in existing international legislation for money laundering in sports, and describes proposals to prevent and monitor illegal gambling activities, specifically in football. Exposing a side of sports that is often left hidden to the world, this new title is also written in an accessible way, even for non-experts.

Fausto Martin De Sanctis holds a Doctorate in Criminal Law from the University of São Paulo’s School of Law (USP) and an advanced degree in Civil Procedure from the Federal University of Brasilia (UnB) in Brazil.

Financial fraud was highest in 2011

Thursday, April 12th, 2012

According to suspicious activity reports (SARs) submitted to the Financial Crimes Enforcement Network (FinCEN), 2011 was a year all-time high in alleged claims of money laundering, debit card fraud, mortgage loan fraud, consumer loan fraud, and casino fraud.

Since 2007, the SAR numbers have ranged from 1.2 million to 1.3 million. In 2011, their number increased to more than 1.5 million. According to analysts, these fraud cases can be directly related to the financial meltdown.

Curt Novy, a mortgage and real estate analyst in San Diego, Calif, said that the financial meltdown lasting from 2007 to 2009 “uncovered all the skeletons” that were present in the marketplace, from mortgage financing to Ponzi schemes. He also noted that these frauds are overlooked in a good economy, but, during an economic downturn, people take a closer look at the books. “Massive fraud isn’t discovered in good times,” he explained. “It’s when the market changes, and financial institutions start looking closer, when the checks stop coming in, they take a closer look at what’s going on.”

Many of the fraud cases are large and complex, therefore investigators suspect it may take the next decade for reviewing them. Some cases involve hundreds of properties, which can take 3-4 years to compile evidence in preparation for a trial.

While fraud peaked in 2011, the FBI is only pursuing 3% of the total 90 000 suspected mortgage loan fraud cases. The FBI is choosing to investigate the large-figured cases.

FBI financial crimes chief Tim Gallagher told ABC News said: “About 70% of our cases are more than a million dollars. We are going after big fish as far as putting cases together, and we’re going after people on the inside because of fiduciary responsibility and the element of trust that they’re violating and doing the most damage”.

Annual Anti-Money Laundering & Anti-Fraud Conference hosted by Western Union

Friday, September 17th, 2010

From September 13 to September 16, the Western Union Company has been hosting in Denver its fifth Annual Anti-Money Laundering & Anti-Fraud Compliance Conference. This is the annual conference that brings together Anti-Money Laundering (AML) compliance officers from the largest agents of Western Union in the United States and Canada with federal and state regulators and law enforcement. For the first time it was launched in 2006 with the intention to educate Western Union Agents on anti-money laundering best practices, regulations and law enforcement trends. Since its introduction, it has become one of the largest anti-money laundering/anti-fraud conferences in North America.

Western Union, which is a money services business financial institution, provides its services through a broad network of third-party agents including banks, postal organizations, grocery stores and other retailers. The Anti-Money Laundering & Anti-Fraud Compliance Conference has the goal to improve the effectiveness of Western Union Agents at preventing money laundering and fraud, and features presentations of the financial services industry’s federal regulators and law enforcement in the U.S. and Canada.

President of the Western Union Stewart Stockdale said in his comments: “We clearly understand our responsibility to protect consumers and the global financial system from potential abuse, and that is what this conference is focused on… At Western Union, we view anti-money laundering as a core part of our business, and also as a competitive advantage.”

Mexico to pass new anti-money laundering legislation

Tuesday, August 31st, 2010

President of Mexico Felipe Calderon proposed new legislation aimed at fighting money laundering and cash smuggling and at preventing Mexican cartels from using billions in U.S. drug profits to finance their criminal organizations. Legislation introduced by  the Mexican president administration and named “unprecedented” by Calderon includes the following measures:

– It would be illegal to purchase real estate in cash;
– The purchase of vehicles, boats, airplanes and luxury goods would be limited to 100,000 pesos (about US$7,700) in cash. Violation of this rule would lead to being sentenced in prison up to 15 years.

If passed, new anti-money laundering law by Calderon would counter the common practice in Mexico, when even in legitimate transactions people prefer cash to avoid being taxed.

Senior Mexican official who investigates financial crimes, states that criminals in this country are increasingly using cash transactions to launder their vast profits. This official, as well as his U.S.  counterparts say that the criminals use billions of dollars in cash to buy airplanes, ranches and businesses to circumvent new Mexican laws that require banks to report large cash movements.

According to the National Drug Intelligence Center, each year Mexican drug cartels and their suppliers from Colombia generate, launder and remove from the U.S. US$18 billion to US$39 billion, largest part of it is transported in cash. It is stated in the recent report by Douglas Farah, a consultant for the Woodrow Wilson International Center for Scholars, that “very little is effectively being done to either impede the movement of drug money into the formal economy or significantly reduce the flow of bulk cash across the U.S.-Mexico border.” No more than 1 percent of this cash is seized by U.S. and Mexican agents.

Isle of Man’s authorities inform on the new Anti-Money Laundering Code

Tuesday, August 24th, 2010

The Department of Home Affairs of the Isle of Man informed all designated non-financial businesses and professionals operating in the island about the Proceeds of Crime (Money Laundering) Code 2010 that will enter into force on September 1, 2010. 

Speaking about the letter informing on the new anti-money laundering legislation, Home Affairs Minister of the British Crown Dependency said that one of the purposes of writing it was ‘to remind people of their responsibilities under anti-money laundering legislation, which was first introduced in September 2007’. Another purpose was to inform the persons and businesses required to comply with the legislation where they can access details of the new Code. He added that ‘compliance with AML laws is essential in ensuring the island is protected from people who would use it for laundering of funds for criminal or terrorist related purposes’, and for maintaining the international reputation of the island.

The Financial Supervision Commission of the Isle of Man also provided information about the update of the
Anti-Money Laundering and Countering the Financing of Terrorism Handbook
, in which new guidance on the new anti-money laundering code was included. Additional amendments have been made to suit the recommendations of the International Monetary Fund.

India became full member of the Financial Action Task Force

Tuesday, August 17th, 2010

India has been welcomed as full member of the Financial Action Task Force (FATF), and became the 34th country member of organization. Since February 2007, India has participated as an observer at FATF, having made its first steps in obtaining full membership. Since 2009, the country took important steps to meet FATF guidelines. The laws amended or passed by the Parliament of India to follow the requirements of FATF (among them the Prevention of Money Laundering (Amendment) Bill, 2009 aimed to combat money laundering, terrorist financing as well as cross-border economic offences) are now in line with FATF 40+9 recommendations, having enabled India’s entering into the organization.

US Charge d’Affaires in India Steven J White said in his comments on India’s membership in FATF that the country ‘has made significant progress over the last several years in moving toward an anti-money laundering and terrorist financing (AML/CFT) regime that meets international standards, and has committed itself to continue to improve its AML/CFT system.’