Page 53 - Banking Finance May 2024

ARTICLE

The proceeds of serious crimes are transferred from one
jurisdiction to another using a variety of TBML techniques
in order to make them appear legitimate.

Money laundering can be hidden behind the trading of
almost any kind of item. The FATF has pointed out that this
usually happens with things like gold, precious stones,
minerals, cars and their parts, food and farm products,
clothes, used textiles, small electronics, building supplies,
machinery, and energy resources. The reason criminals pick
these items is that they're hard to check thoroughly at
customs. It would take way too much time to verify all the
details in the paperwork for a whole shipment.

When these items are sent across several countries to reach
the buyer, it gets even easier to hide where they originally The shell company then engages in a series of transactions
came from. For items whose prices can vary a lot, it's tough designed to "clean" the dirty money, often involving tactics
to tell if the price listed in the documents is too high or too such as issuing fake invoices for non-existent goods or
low. And items like precious metals and minerals that are services, or implementing round-tripping, where the same
obtained illegally are especially appealing to criminals assets are exchanged multiple times to simulate legitimate
because, once cleaned, they can be used just like cash. business activity. As a result, the layers of obfuscation make
it challenging for law enforcement agencies and financial
6. Shell Companies and Offshore Accounts: institutions to detect and combat money laundering
Money launderers exploit shell companies to hide the origin activities facilitated by shell companies.
of illicit funds, create false invoices, and engage in complex
transactions that obscure the money trail. Typically, a shell 7. Instant Messaging Apps:
company is set up in a jurisdiction known for its strict privacy Nowadays, a lot of messaging apps let people send money
laws, providing a veil of secrecy that makes it difficult for directly to each other, which has become a new way for
investigators to trace the money trail back to the original people who want to launder money to do their business.
criminal activity.
For example, some messaging apps allow to send money or
to do peer to peer transaction using their platform. This
feature might give people who want to launder money a
chance to move money secretly in messages that are
encrypted. This means the messages are scrambled so no
one else can read them, allowing illegal transactions or
conversations to happen without any record.

Challenges in Detecting Modern Money
Laundering Techniques

Old ways of investigating crimes aren't as good at catching
clever money laundering anymore. Investigators need to
learn new tricks because the old ones might not catch
everything, especially the trickier schemes. Here's a closer
Source: https//pideeco.be/ look at the problems they're facing:

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