FROM A
DIFFERENT ANGLE by Kenneth Rijock
Financial Crime Consultant, for World-Check
How will Money Launderers react to FinCEN's Expanded Information Sharing ?
9 February 2010

Friday's filing of a FinCEN Final Rule*, which allows EU law enforcement agencies to to submit AML/CFT information requests to US banks, and American law enforcement to do the same in the countries of the European Union, will have a serious effect on international money launderers. These "professionals," who have been relying for decades on the inability of American and EU law enforcement to conduct effective transnational investigations, now have a potentially major problem; they will be at a higher level of risk for exposure, forfeiture and arrest. Like risk managers in the legitimate world, they abhor dangerously high levels of risk. So, what will their responses be? Good question.  

Since money launderers based in Europe do not like to be unmasked, and their money seized, one or more of the following reactions may be seen in the coming months:

  • Movement of funds to European countries that are neither current EU members, nor on track for EU accession in the short term.
  • Sell off all assets in EU countries that are presently investigating the launderers' clients.
  • Move all liquid assets to Caribbean or  Asia-Pacific tax havens, which appear to be unaffected by this Rule.
  • Carefully place the laundered funds in long-term investments, using front men.
  • Sell off their illiquid assets quickly, and send the funds to a location neither in the EU nor the US..

Watch for any unusual movement of funds from places where you least expect it. 


_______________________________________________________________________________________________________
* FinCEN: Expansion of Special Information Sharing Procedures to deter Money Laundering and Terrorist Activity
http://www.fincen.gov/statutes_regs/frn/pdf/20100204.pdf

The facts and opinions stated in this article are those of the author and not those of World-Check. World-Check does not warrant the accuracy of any facts and opinions stated in this article, does not endorse them, and accepts no responsibility for them.

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