Page 569 - IOM Law Society Rules Book

TYPOLOGIES

Typology 1: The use of straw men

An important characteristic is the use of false identities, “straw men” or front
companies in transactions to provide clean names and thus avoid detection.

Typology 2: Channelling funds through several different financial institutions

By channelling funds through several different financial institutions the wire transfers
appear to come from different and seemingly unrelated sources, thereby masking the
true source of the funds. There also seems to be some use of wire transfers through
non-bank financial institutions or alternative remittance services by terrorists
(informal money or value transfer systems) with the idea that avoiding mainstream
financial institutions will help terrorist funding – like the proceeds of non-terrorist
criminal activity – remain undetected by financial monitoring systems or investigative
authorities.

Typology 3: The use of low value wire transfers

In general terms, other than the generally small size of such transactions, the value of
individual transfers is generally not a distinctive feature when carried out for terrorist
financing purposes. Indeed, the low value of the transfers when compared with the
high overall volume of such transactions is an additional factor that further
complicates detection of terrorist use of the financial system. Establishing an average
size for terrorist related wire transfers has proved impossible with reported transfers
as low as the range of US$25 to US$500. However, wire transfers often appear to
have been structured in amounts below any mandatory reporting requirements.