Commission says US needs radical AML overhaul

A US congressional commission has called on the authorities to radically reform anti-money laundering (AML) operations by blocking the flow of illicit funds using complex cross-border financial transactions and cryptocurrencies.

The commission is specifically concerned about black-market peso exchange trade-based money laundering (TBML) operations that continue to be routinely used to launder funds for Mexican and Colombian cartels repatriating the proceeds of drugs sales in the US.

Radical overhaul needed

The Western Hemisphere Drug Policy Commission has proposed a radical overhaul of US anti-narcotics policy. It wants to replace the US drug certification process – in which countries are labelled ‘naughty or nice’ – with more nuanced diplomatic approaches.

“The concept of a Majors List of countries of particular interest, with numerical definitions of drug cultivation or production (mainly plant-based), cannot keep pace with rapidly changing threats from synthetic drugs produced in and shipped from almost anywhere in the world,” the report says.

“A requirement for a theatrical public rollout of our ‘naughty and nice’ countries is similarly outdated”, the report adds.

TBML operations

Black-market peso exchange TBML operations are used, for example, by Los Angeles Fashion District companies that import apparel and textiles into the US or manufacture goods in the US with dollars illicitly earned there by the drug cartels.

Those goods are then exported, typically to Mexico or Colombia, and sold at local stores for pesos that are then deposited in domestic accounts attached to the drug cartels.

Categories: Trade Based Financial crimes News

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