US names jurisdictions where money laundering is facilitated by trade or trade finance

Several countries named as “major money laundering countries” in the US State Department’s 2016 International Narcotics Control Strategy Report (INCSR) are allowing trade or trade finance to facilitate illicit financial flows.

Free trade zones, vulnerabilities at some very large ports and airports as well as banking secrecy all play a part in creating environments where trade-based money laundering becomes a relatively low risk option for money launderers.


Panama’s location and status as a regional financial, trade, and logistics centre along with its lax regulatory system make it an attractive target for money launderers according to the report.

It says that money is laundered via bulk cash and trade by exploiting vulnerabilities at the airport, using commercial cover and free trade zones, and exploiting the lack of regulatory monitoring in many sectors of the economy.

According to INCSR, the protection of client secrecy is often stronger than the authorities’ ability to access information and pursue an investigation.


In Curacao, the report says money laundering organisations take advantage of an expansive shipping container terminal with the largest oil trans-shipment centre in the Caribbean and two free trade zones (airport and harbour), to place, layer, and launder illegal proceeds.

Money launderers on the Caribbean island also take advantage of its banking secrecy, offshore banking and incorporation systems and the availability of US dollars.


Money laundering is widespread in Venezuela, and can be seen in a number of areas, including government currency exchanges, commercial banks, gambling, real estate, agriculture, livestock, securities, metals, the petroleum industry and minerals.

Trade-based money laundering remains a common and profitable method in Venezuela, the report concludes. The full report may be downloaded here.

Categories: Trade Based Financial crimes News

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