Hey Guys we the team of HELPING SURFERS INC. has come up Money Laundering Part 7 as promised. We are going in deep for FATF. In this part we are going to share information about these.
Note- HELPING SURFERS INC. Do not promote any illegal activities.
Note- HELPING SURFERS INC. Do not promote any illegal activities.
Financial Action Task Force On Money Laundering. [FATF]
The FATF is one of the premier intergovernmental organizations that is directly concerned with the issue of money laundering, and more recently, the financing of terror throughout the world. The organization is a result of a combined effort by the G7 (Canada, France, Germany, Italy, Japan, UK and US) to improve and standardize anti money-laundering laws.
In 1990, the organization published a set of 40 recommendations that are widely considered to set the global standard for effective reforms. The recommendations covered changes countries could make to their laws, enforcement mechanisms and investigative practices to prevent money laundering within their own borders.
In addition to encouraging greater cooperation among member nations, the organization serves to place an uncomfortable spotlight on nations that are flaunting international standards.
The FATF publishes a regularly-updated blacklist of the countries that are believed to be facilitating global money laundering. Countries are added to this list when there is evidence that they are hindering the enforcement of money laundering laws by providing safe havens for launderers and institutions than enable them.
In the past, countries placed on this list—and businesses headquartered in them—have faced intense financial pressure. Despite the fact that the list has no legal force on its own, it has been proven to be a powerful coercive force for reforms.
The organization has also grown far beyond its original membership. Thirty-six countries are members now, and a large number of international banks and organizations have declared themselves to be observers of the FATFs mission.
International Money-Laundering Information Network (IMoLIN)
IMoLIN is an anti money laundering research resource that is operated by the United Nations. This network was developed to provide support to policy practitioners, lawyers and law enforcement officers who need are working to improve the detection, identification and prosecution of money laundering.
The organization primarily focuses on developing useful information, statistics and case studies. This research material can be used by established and developing nations to determine the most effective reform measures against money laundering and the financing of terrorist organizations.
Laws Against Money Laundering
The work of the initiatives discussed earlier has resulted in stronger laws all around the world. As a global center for finance, the laws of the United States have proven to be very influential on other states. The Bank Secrecy Act (BSA) and anti-money laundering provisions of the Patriot Act represent some of the most influential in the world.
The Bank Secrecy Act of 1970 (BSA)
The BSA was one of the first major anti-money laundering (AML) laws in the US, and remains in force today.
In addition to applying heavy fines and criminal penalties for money laundering, the act steps ahead of launderers by requiring a significant amount of reporting. Those who fail to report can be prosecuted whether they’re involved in money laundering or not. This forces money launderers to commit prosecutable acts before they’ve even managed to set up their schemes.
The act requires 5 main types of reports.
- Currency Transaction Reports: CTRs are the reports that banks must file in the event of transactions that exceed $10,000 in one day. These reports are filed with the Financial Crimes Enforcement Network and include a significant amount of information that can be actioned quickly.
- Suspicious Activity Reports: SARs are the reports that banks must file when it appears that customers are attempting to work around CTRs. Banks may not inform customers when their behavior triggers the filing of a SAR.
- Foreign Bank Account Reports: FBARs must be filed by citizens who are keeping more than $10,000 in foreign bank accounts.
- Monetary Instrument Log: MILs must be filed by banks whenever customers purchase money orders, cashier’s checks or travelers checks between $3,000 and $10,000 in value. These logs must be maintained for several years and presented to investigators on request.
- Currency and Monetary Instrument Reports: CMIRs must be filed by banks or institutions that transport (by any means) certain monetary instruments such as currency and travelers checks.
The US is known around the world for applying particularly heavy fines against financial institutions that are involved in money laundering. Danske Bank, for example, is expected to pay far more in fines to the US than it will pay to its own home country, Denmark. Many of these fines come from the provisions of the BSA.
The BSA was recently amended as part of the USA PATRIOT ACT. The changes required banks and other financial institutions to establish their own comprehensive money laundering programs. Banks are obligated to create internal policies, assign permanent staff to monitor compliance and enforce the policies through training and audits.
Money Laundering Statistics
The FATF organization covered in the Anti-Money Laundering Initiatives Section takes a leadership role in gathering and publishing money laundering statistics. Their most-recently published figures provide a sobering look at how this crime affects the world economy.
As much as 1.5 trillion is laundered every year
While the true figures are impossible to generate, money laundering is believed to account for more than a trillion dollars every year. This is a trillion that is removed from local tax bases that are used for infrastructure upgrades and civil services.
Real Estate is Increasingly Popular in Money Laundering Schemes—30% of high-value all-cash real estate purchases in New York were conducted by individual under investigation
Not all laundering schemes pull money out of the economy, some just destabilize it through monopolization of real estate. Real estate is increasingly one of the preferred vehicles of money launderers.
The amount of money laundered through cryptocurrencies tripled between 2017 and 2018
Between the two previous years, cryptocurrency went from representing less than $200m of funds laundered to more than $700m. While this is a statistically small amount of all money laundered every year, the amount involved is already expected to double again in 2019.
Bottom Line
Laundered money accounts for a statistically significant amount of all money in the world economy. This makes the issue a serious one for all types of businesses, and particularly those businesses involved in the financial sector.
Understanding the way these schemes work, how they’ve played out in history and how both international and US laws are used against them can help anyone understand how to detect when their organization may be involved.
This is the end of this MONEY LAUNDERING SERIES.
Stay Tuned and wait for next.
