A US State Department report has described Colombia’s Black Market Peso Exchange (BMPE) as “one of the most pernicious money laundering schemes in the Western Hemisphere.”
The view is expressed in the recently released 2015 International Narcotics Control Strategy Report, which contemplates trade-based money laundering (TBML) in several countries (AML Newsflow, 27 March 2015).
The BMPE is also one of the largest money-laundering schemes according to the report, which says that billions of US dollars’ worth of drug proceeds a year are processed from Colombia alone via TBML.
Other money laundering methods including smurfing – a technique that involves splitting a large bank deposit into smaller deposits to evade financial transparency reporting requirements – and cash smuggling.
How it works
Methods similar to BMPE are also found outside the Western Hemisphere according to the report, which says variations on the scheme usually involve brokers contacting importers in the country receiving the money who want to buy goods from a US business.
Drug dollars are used to pay the exporter on behalf of the foreign importer. The importer pays the broker in local currency while the broker takes a cut and passes along the remainder to the drug cartel.
Categories: Trade Based Financial crimes News