International trade is becoming increasingly susceptible to trade based money laundering (TBML) according to the managing director of identity verification service provider, Trulioo.
Zac Cohen argues that global collaboration is key to ensuring implementation of anti-money laundering legislation that effectively prevents and detects TBML and that it is essential that the identity of all parties to a trade transaction are known.
Writing in the International Banker, Cohen says large-scale techniques for money laundering have become increasingly sophisticated over time.
Illegal activities are often masked under massive volumes of legitimate trade, making them challenging to uncover he says.
Cohen argues that techniques such as under- or over-invoicing, falsifying documents, and misrepresenting financial transactions, are difficult to trace as they can involve multiple parties, jurisdictions and transactions.
To be able to uncover these illicit activities, he says it is imperative to be able to identify and verify the people behind them.
Cohen’s article also looks at the importance of collaboration in overcoming the problems of different regulatory standards and levels of enforcement in international trade.
“In order to take an active rather than reactive approach, renewed focus must be put on collaboration between policymakers, regulators and governments to leverage new technology and close gaps and loopholes,” he concludes.
Zac Cohen’s article, Global Collaboration Key to Ensuring Implementation of Anti-Money Laundering Legislation, can be found here.
Categories: Trade Based Financial crimes News