International criminal organisations are using millions of euros in legitimate products to mask stolen funds through an international money laundering operation that is taking place in Ireland.
Pat Lordan, head at Garda Siochana, spoke at the European Anti-Financial Crime Summit on behalf of the Garda National Economic Crime Bureau (GNECB) regarding funds embezzlement and mitigating trade-based money laundering cases in Ireland. To continue the successful fight against organised crime groups, Lordan said, his detectives need to put in more effort and allocate sufficient resources.
“We’ve increased detections, charged and convicted more people – we’ve increased preventative methods – taken on organised crime groups. A lot of countries feel that it is better not to know about this because then they look okay, but my view is that no country is okay in this realm – you have to dig in, find the crime and deal with it. Ireland is in a good place dealing with money laundering crimes, but I am concerned about the new methods that have appeared in recent times,” he said.
One of the most prevalent methods of laundering money in recent years has been “trade-based money laundering“. Criminals use the money they have made through criminal activity, drug dealing or fraud primarily to purchase legitimate goods and remove the paper trail to their identity through a complicated network of distributors and deals.
“When they steal money in Ireland or wherever, they want to get that money back to their boss in their home country. The difficulty of carrying the money you have to go through an airport or a port, and you may get stopped by customs or law enforcement and lose the money,” he continued, “One organised crime group we are dealing with is transferring that money into product, real goods such as pharmaceuticals, shoes, machinery, perfume anything that they can sell on. They are then shipping those goods to their home country and the full value of the goods is repatriated to the home country where the leadership is operating. The goods have been paid for with the money they have got through fraud here in Ireland,” he explained.
As Lordan has stated, several European countries are involved in this crime. According to him, payments could be divided among three accounts in three countries to conceal the payment’s source. Ang Garda Sochána is coordinating with the German, Swiss, Belgian, Italian, and French police to resolve the issue. GNECB has also established links with police in the United States and South Africa.
“We are leading out on this along with some really expert help and advice with Interpol – we’ve done a lot of work in this area but there is more work needed,” he explained.
Among the strategies Lordan explained for preventing this type of laundering is that the Garda should take the initiative to talk to companies so they may be “concerned” about the processing of such transactions by their companies.
“If you are a manager of a company and you see payments for an order coming from multiple accounts you now have to ask yourself the question: ‘am I now laundering money for organised crime? We’ve knocked on the doors of companies in Europe and where they now understand they laundered €1m money for an OCG – it is not a pretty place to be,” he added.
According to Lordan, these criminal organisations are primarily located in West Africa. Further concerns about criminal gang members infiltrating legitimate businesses to steal bank information and other personal information are being raised.
Police were investigating several incidents of this and arrested a woman who was working for a crime group on behalf of a firm recently. Taking an inadvertent photograph with her real identity in view unintentionally led to her arrest.
Financial crime experts worldwide attended the event at the RDS in Dublin. NCA Head of Intelligence Operations Mark Bishop represented the National Crime Agency (NCA). The head of financial crime compliance at AIB, Brian McKenzie, also discussed the impact of sanctions.
“We watch closely the proposals for the EU eleventh round of sanctions and note proposals to target entities in countries such as China, Uzbekistan, Syria, Armenia and the United Arab Emirates. Obviously, any potential for China-related sanctions is a cause for alarm and I note warnings from Germany to the EU about potential trade sanctions against China,” McKenzie added.
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ENHANCING TRANSPARENCY AND BENEFICIAL OWNERSHIP IN THE FIGHT AGAINST TRADE-BASED MONEY LAUNDERING
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