Use of foreign bank accounts: to move funds away from interdiction by domestic authorities and obscure the identity of persons controlling illicit funds. Use of nominees, trusts, family members or third parties etc: to obscure the identity of persons controlling illicit funds. Use of offshore banks/businesses, including trust company service providers: to obscure the identity of persons controlling funds and to move monies away from interdiction by domestic authorities. Use of shell companies/corporations: a technique to obscure the identity of persons controlling funds and exploit relatively low reporting requirements.
Mingling (business investment): A key step in money laundering involves combining proceeds of crime with legitimate business monies to obscure the source of funds. Investment in capital markets: to obscure the source of proceeds of crime to purchase negotiable instruments, often exploiting relatively low reporting requirements. Gaming activities (casinos, horse racing, internet gambling etc): Used to obscure the source of funds – eg buying winning tickets from legitimate players using casino chips as currency for criminal transactions using online gambling to obscure the source of criminal proceeds.Ībuse of non-profit organizations (NPOs): May be used to raise terrorist funds, obscure the source and nature of funds and to distribute terrorist finances Trade-based money laundering and terrorist financing: usually involves invoice manipulation and uses trade finance routes and commodities to avoid financial transparency laws and regulations. Exploited by money launderers and terrorist financiers to move value without detection and to obscure the identity of those controlling funds. Often work in parallel with the traditional banking sector and may be outlawed (underground) in some jurisdictions. Underground banking / alternative remittance services (hawala / hundi etc): Informal mechanisms based on networks of trust used to remit monies. Use of Wire transfers: to electronically transfer funds between financial institutions and often to another jurisdiction to avoid detection and confiscation. Purchase of valuable assets (real estate, race horses, vehicles, etc): Criminal proceeds are invested in high-value negotiable goods to take advantage of reduced reporting requirements to obscure the source of proceeds of crime.Ĭommodity exchanges (barter): Avoiding the use of money or financial instruments in value transactions to avoid financial sector AML/CFT measures - eg a direct exchange of heroin for gold bullion.
Move in monies portable#
Purchase of portable valuable commodities (gems, precious metals etc): A technique to purchase instruments to conceal ownership or move value without detection and avoid financial sector AML/CFT measures – eg movement of diamonds to another jurisdiction. Use of credit cards, cheques, promisory notes etc: Used as instruments to access funds held in a financial institution, often in another jurisdiction. Structuring (smurfing): A method involving numerous transactions (deposits, withdrawals, transfers), often various people, high volumes of small transactions and sometimes numerous accounts to avoid detection threshold reporting obligations. The following examples provide a few key money laundering and terrorist financing methods, techniques, schemes and instruments:Īssociation with corruption (bribery, proceeds of corruption & instances of corruption undermining AML/CFT measures): Corruption (bribery of officials) to facilitate money laundering by undermining AML/CFT measures, including possible influence by politically exposed persons (PEPs): eg investigating officials or private sector compliance staff in banks being bribed or influenced to allow money laundering to take place.Ĭurrency exchanges / cash conversion: used to assist with smuggling to another jurisdiction or to exploit low reporting requirements on currency exchange houses to minimise risk of detection - eg purchasing of travellers cheques to transport value to another jurisdiction.Ĭash couriers / currency smuggling: concealed movement of currency to avoid transaction / cash reporting measures. The APG's typologies framework includes processes for collection and analysis of information and case studies, and for sharing this information within the APG membership, the global AML/CFT network and with the private sector. Conclusions and findings of the research provide decision-makers, policy experts and law enforcement authorities with up-to-date empirical information to develop strategies to combat these threats. The APG undertakes detailed and relevant typologies research to better understand the money laundering and terrorist financing environment in the Asia/Pacific region.
Typologies research is the study of methods, techniques and trends in money laundering and terrorist financing.
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