Banks’ expanding technology can help stem TBML related illegal wildlife trade

Banks can help organisations intent on preserving the earth’s fisheries, forests, wildlife and other natural resources by employing the increasingly sophisticated technologies used to monitor correspondent relationships or their trade finance operations according to the compliance lead at FICO, the California-based company best known for its measure of US consumer risk, the FICO score.

Timothy Choon also points out the connections between illicit trade in natural resources and trade-based money laundering (TBML) highlighted by conservation groups such as the USAID-funded Targeting Natural Resource Corruption (TNRC) consortium to improve biodiversity outcomes

TBML connections

In an opinion piece for the Jakarta Post, Choon describes illicit wildlife trade (IWT) as “a dimension of the wider TBML problem, because from that perspective there is no difference between the content of a container being forged goods or ivory, or between people wanting to earn illicit money through trade fraud or selling powdered rhino horn.”

The methods for trafficking wildlife, and the inevitable money laundering that is involved, are hardly new he says and explains that tactics such as mingling illicit proceeds with legal ones, mislabelling shipping containers, and forging documents, are used by criminals to move, hide, and launder their proceeds.

Regional and sectoral concerns

Africa is the main area of concern, in particular due to the killing of rhinos, elephants and pangolins by criminal gangs that move horns, tusks and scales shipping these clandestinely onto markets in Asia.

But Choon points out that IWT trade routes are as global as those for any other illicit trade. According to Europol, the EU is a major transit point between Africa and Asia, while the European fashion industry accounts for an overwhelming 96 per cent of the python skin trade.

FATF recognition

A year ago the Financial Action Task Force (FATF) approved a proposal by China to launch a programme to crack down on IWT-linked money laundering.

According to the Environmental Investigation Agency (EIA), wildlife crime generates annual profits of between US$7-23 billion, making it one of the most lucrative forms of transnational organised crime. But the enforcement response in many jurisdictions remains inadequate according to the agency.

The EIA has been critical of the low deployment of potentially powerful tools such as anti-money laundering measures and welcomed what it described as FATF’s “long overdue” commitment (Trade-based Financial Crime, 31 January 2020).

Making the connection: Trade-based money laundering, corruption, and natural resources, a video produced by TNRC, which is implemented by the World Wildlife Fund, U4 Anti-Corruption Resource Centre, TRAFFIC and the Terrorism, Transnational Crime and Corruption Centre (TraCCC) can be found here.

Timothy Choon’s opinion piece, Banks can help stop illegal wildlife trade, can be found here.

Categories: Trade Based Financial crimes News

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