Sophisticated modern tools such as blockchain and artificial intelligence offer opportunities to see and analyse information and root out illicit trade according to a US senator who for years has been calling for more action to curb trade-based money laundering (TBML).
US senator Bill Cassidy, a Republican who sits on the US Senate Finance Committee, has been calling for tougher action on illicit trade for several years and sees TBML as one of the main methods by which drug traffickers, criminal organisations and terrorist financiers use legitimate trades to disguise illegally obtained proceeds (Trade Based Financial Crime 23 March 2018, 23 July 2018, 13 November 2019 and 3 January 2020).
Full government coordination
Modernising customs operations would create greater transparency in individual shipments Cassidy says in an opinion piece published in the Jerusalem Post that focuses on the allegedly extensive use of TBML in Latin America by Hezbollah, which the US sees as a terrorist organisation, to fund its activities.
He argues that full government coordination would allow the customs and border agency to work with the government departments of treasury, justice, commerce to apprehend and prosecute violators using TBML to launder illicitly gained funds.
Implementing TBML solutions
Cassidy says his office is working to implement solutions to counter TBML using sophisticated technologies such as blockchain and artificial intelligence through several workstreams.
These include customs modernisation legislation, commissioned research to identify weaknesses and responses and blockchain pilot projects.
Landmark white paper
The US senator notably promoted the use of sophisticated technologies as tools to curb illicit trade in a comprehensive white paper he published in 2019 that addresses TBML as a top national security threat which ties together drug trafficking, terrorism, and dangerous counterfeit consumer products.
In that paper he says that effectively addressing TBML should involve the US developing a public distributed ledger to assist government agencies in developing systems to track and correlate shipping manifest and financial information from the public and private sectors in real-time.
Cassidy concluded that to address TBML, the US should develop an appropriate methodology and system to integrate necessary trade data and intelligence data; direct existing federal agencies to prioritise combating TBML through interagency and private sector cooperation, and enhance cooperation with trading partners to identify, prosecute, and curtail TBML.
The article by Cassidy published by the Jerusalem Post, Hezbollah is a threat to Latin America, can be found here.
Cassidy’s 2019 white paper, Trade-based Money Laundering: An Asymmetric Threat with Ties to Terror and Drugs, can be found here.
Categories: Trade Based Financial crimes News