Spanish authorities have unearthed a suspected trade-based money laundering (TBML) operation in which a criminal network adulterated highly priced saffron to launder millions of euros.
The network falsified documents to pass off the saffron they sold as a high-grade version of the spice whereas in reality it was not only a cheaper grade, it was also adulterated.
The operation was unearthed by Spanish police working with Europol when officers raided a company in the central Spanish city of Ciudad Real, located in the La Mancha region.
Saffron grown in La Mancha is considered one of the world’s finest grades of the spice and has been awarded Protected Denomination of Origin status by the EU.
The company passed off the saffron they exported as locally produced but in reality it imported saffron, mainly from Iran, that was then blended it with cheaper spices and chemicals to falsely inflate its price and increase the firm’s profit margins.
Suspicious import-export businesses
Investigators identified more than 500 shipments of adulterated saffron worth an estimated €10 million (US$12 million), according to Europol.
The criminal network laundered their criminal proceeds through multiple bank transfers emanating from a Spanish company to different companies across the EU pretending to having bought this saffron. These companies were not in the import-export business, which raised suspicions.
Complex TBML scheme
Europol says the investigation into the transactions revealed a complex TBML scheme set-up across the EU.
The criminal network also used carriers to transport large amount of cash derived from the criminal business. The carriers were controlled by money brokers operating in the EU and with connections in non-EU countries acting as nodes in the hawala network.
Categories: Trade Based Financial crimes News