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”.

These jurisdictions were moved up on a money laundering watchlist. The report said the three have become “major money laundering countries,” or those “whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking.”

The report moved Argentina and the two Caribbean island countries to the list of “jurisdictions of primary concern” from the less acute “jurisdictions of concern” category. So, Argentina, Curacao and St Maarten join a wide-ranging list of 66 countries that includes Australia, Brazil, China, Japan, Russia, the United Kingdom, etc.

On March 7, the 2012 International Narcotics Control Strategy Report was published. Washington’s list of 190 countries classifies them in 3 categories: of primary concern, of concern and monitored.

The Vatican was included into the 2nd category, along with 67 other nations including Poland, Ireland, Hungary, Egypt and Chile.

The Vatican was added to the list as it is vulnerable to money laundering. “To be considered a jurisdiction of concern merely indicates that there is a vulnerability to a financial system by money launderers. With the large volumes of international currency that goes through the Holy See, it is a system that makes it vulnerable as a potential money-laundering center,” Susan Pittman of the State Department’s Bureau of International Narcotics and Law Enforcement said.

In 2011, the tiny city-state adapted internal laws to comply with international standards on financial crime.

It is seeking inclusion on the European Commission’s so-called “white list” of states complying with international standards against tax fraud and money-laundering. A decision on its inclusion is expected in June 2012.

The FATF wants governments around the world to require greater openness about the real owners of companies, so that it would be harder for financial criminals and terrorists to conceal their identities or hide their assets.

According to FATF findings, the 5 above-mentioned countries were flaunting recommendations made to them toward fighting money-laundering and financing terrorism.

FATF removed no countries from the blacklist. However, Honduras and Paraguay were removed from an intermediary “grey-list” of countries as falling behind on international standards despite having committed to them.

The international watchdog can make recommendations to any of the 36 countries that have signed a membership charter, as well as to other nations, but it has no power to carry out sanctions. The recommendations made by FATF reach more than 180 countries through regional networks. According to the body’s estimations, money laundering and related financial crimes cost 2-5% of global GDP (gross domestic product).

The FATF blacklist currently includes 17 countries: Bolivia, Cuba, Ethiopia, Iran, Kenya, Myanmar, Nigeria, North Korea, Sao Tome and Principe, Sri Lanka, Syria, Turkey, Pakistan, Indonesia, Ghana, Tanzania and Thailand.

The FATF grey-list includes 22 countries: Algeria, Angola, Antigua and Barbuda, Argentina, Bangladesh, Brunei, Cambodia, Ecuador, Kyrgyzstan, Mongolia, Morocco, Namibia, Nicaragua, the Philippines, Sudan, Tajikistan, Trinidad and Tobago, Turkmenistan, Venezuela, Vietnam, Yemen and Zimbabwe.

The new AML guidelines will take effect on April 1, 2012. They serve to replace the existing Prevention on Money Laundering and Terrorist Financing Guidance Note published by the SFC. The new guidelines provide guidance to the financial sector that include the operation of the relevant provisions of the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance (AMLO).

Gazetted on July 8, the enacted AMLO was conducted by Hong Kong’s Financial Services and Treasury Bureau with a view not only to enhance the AML/CTF regime in Hong Kong’s financial industry but also meet the latest international standards as regards customer due diligence (CDD) and record keeping.

A consultation launched on September 30 invited comments on the proposed guidelines from industry practitioners, trade associations and professional bodies. It ended on November 18, 2011.

The new guidelines will replace the existing Prevention on Money Laundering and Terrorist Financing Guidance Note published by the SFC. They are to provide guidance to the financial industry relating to the operation of the relevant provisions of the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance (AMLO).

On July 8, 2011, the enacted AMLO was gazetted after 2 rounds of consultation conducted by Hong Kong’s Financial Services and Treasury Bureau. Its is aimed at enhancing the anti-money laundering and counter-terrorist financing regime in Hong Kong’s financial sector, whoch is neede in order to meet the latest international standards, especially in respect of customer due diligence (DD) and record keeping.

On September 30, 2011, the SFC launched a consultation and welcomed comments on the then-proposed guidelines, and then received submissions until November 18. In general, respondents found the guidelines helpful.

According to Cagayan de Oro Rep. Rufus Rodriguez, who authored House Bill 4275, amendments to the measure approved by the House of Representatives weakened the proposed legislation.

Rodriguez said that substantial information was removed before the approval. For example, the provision allowing the Anti-Money Laundering Council (AMLC) to look into bank accounts of suspected money launderers without informing the account holder, given there is probable cause to do so was removed from the document.
This provision was dropped because of the proposal from House Minority Leader Edcel Lagman, who wanted to give the AMLC the power to inquire into the bank account of suspected money launderers only “after due notice and hearing.” This means that the Anti-Money Laundering Council will have to secure the approval of the Court of Appeals before it can look into questionable bank accounts, a a result, the depositor will also be informed of such an action.

State Department spokesman Mark Toner said that the operations aimed to disrupt money laundering networks are fully vetted and fully coordinated with Mexican authorities. Toner stressed: “The Drug Enforcement Administration (DEA) works with Mexican authorities to gather and use information about these criminal organizations to counter threats that they pose to both our countries”.

According to the Mexican government, bilateral work is done in an existing legal framework that covers activities of international authorities on the territory of Mexico.

However, many Mexican politicians want more information. The Senate security committee chairman in Mexico City, Felipe Gonzalez, said that President Felipe Calderon should report to Congress on the anti-money laundering operations. He suggested that the facts about what has been achieved in terms of arrests, seizures of funds and crime reduction should be revealed. It is worth noting that since 2006, when its government launched a major military crackdown against the powerful drug cartels, some 45 000 people have been killed in Mexico.

The Consultation Paper has been launched prior a wider review of the basis for, and scope of, customer due diligence concessions in the Money Laundering Order that will take account of international standards set by the Financial Action Task Force (FATF).

According to the Commission, proposals in the Consultation Paper will clarify the additional customer due diligence measures to be taken when a relationship with a customer is established remotely and money laundering and terrorist financing risk is considered to be higher than usually. Also, the JFSC’s reviewed proposals should provide additional guidance on identifying countries with a higher risk of money laundering or terrorist financing. The proposals in the Paper will specify some additional due diligence measures to be applied where a customer has a connection to Iran or North Korea, and where a customer is considered to present a higher risk as a result of a connection to countries like Bolivia, Kenya, Nigeria, Sri Lanka, Syria, Turkey, etc. As the risk of money laundering or terrorist financing occurring is considered to be less for a particular customer, product or service, the proposals are to extend the circumstances in which it may be appropriate to simplify customer due diligence measures.