Prosecute money launderers to stamp out terrorism and corruption

The best way to stamp out terrorism and corruption is to prosecute money launderers according to an expert at a US think-tank focused on national security and foreign policy.

Emanuele Ottolenghi, a senior fellow at the Washington-based Foundation for Defence of Democracies, underlines that groups such as Hezbollah, which the US has designated a terrorist group, uses trade-based money laundering (TBML) to move cash to buy and stockpile materials and equipment used to commit acts of terrorism.

Target financial structures

Reports released last month say that in 2015, British authorities caught Hezbollah-linked operatives stockpiling more than 6,000 pounds of explosives on the outskirts of London.

But as Ottolenghi points out, while the British deserve credit for unearthing the London bomb factory, they did not destroy the underlying commercial or financial structures that allowed the group to buy and stockpile such materials.

Aggressive prosecution

For too long, Ottolenghi says counterterrorism operations have focused too narrowly on disrupting attacks.

What is needed is aggressive prosecution of those who carry out the groups’ financial transactions he argues. If they are not prosecuted, then the illicit networks that provide financial and logistical support for Hezbollah are likely to remain intact he concludes.

TBML’s key role

According to Ottolenghi, the US has begun taking steps in the right direction by successfully securing the extradition from Paraguay of the businessman Nader Mohamad Farhat, who is suspected of links with Hezbollah, to face money laundering charges in Miami (Trade Based Financial Crime, 29 July 2019).

US prosecutors have confirmed that TBML played a key role in his operations in the Argentina-Brazil-Paraguay Tri-Border Area.

According to a US Justice Department statement, Farhat participated in “an international money laundering scheme relying on the complexities of global trade … to launder millions for transnational drug traffickers and other bad actors.”

Emanuele Ottolenghi’s article, To Fight Terrorists, Follow the Money, can be found here.



Categories: Trade Based Financial crimes News