Money laundering, 21st century-style, part 2 of 2

Businesses "go global" by satisfying needs that unite cultures. However, money launderers do it by exploiting legal and knowledge gaps between jurisdictions. To deter them, governments and industries around the world must collaborate. But persuading busy and cash-strapped clients to pitch in isn't easy. So CFEs advising them must have a comprehensive understanding of international money laundering techniques. The profession's collective intelligence is a rich source of such insight. To that end, here are money laundering reports from CFEs on six continents.

LATIN AMERICA: THE BIGGEST AND NEWEST THREATS

Juan Manuel Portal Martinez, CFE, CIA, CPA, is auditor general of Mexico and president of the Mexico City ACFE Chapter.

"Most money laundering (ML) in Latin America serves the illegal drug trade," Portal says. "But regardless of the source of their illicit income, criminals in this region favor certain techniques. These include schemes that disguise illegitimate funds as surcharges on otherwise lawful commercial transactions or conceal criminal profits in legal payments sent home by Latin Americans working abroad."

Yet even as regional nations grapple with these challenges, Portal says, new frauds emerge. In one, ostensibly genuine religious organizations — acting on behalf of criminal groups — deposit large quantities of cash in their bank accounts, alleging the funds are worshipers' donations. In another scheme, debit and prepaid cards help money launderers move enormous sums — broken into countless small amounts — across international borders without triggering financial controls that monitor larger transactions.

Regional improvements
Criminals launder anywhere from US$100 billion to US$250 billion (2 percent to 5 percent of Latin America's US$5 trillion GDP) each year.

In response, countries have increased their AML efforts. But, Portal says, they can further mitigate risks by: