Money laundering through money remittance ... - Council of Europe

2010 - Money Laundering through Money Remittance and Currency Exchange Providers
comes from accepting the money of straw men and persons identified on the basis of forged
documents. Some examples of money laundering schemes obtained as part of this study involved
straw men who were hired as „employees‟ of a foreign company.
Box 3. Use of persons hired as employees to launder money originating from internet fraud
Mechanism: money remittance
Red-flag indicators: using „money mules‟
Case description: A person is „contacted‟ (for example through the internet) for a job in a company established
abroad. The person receives money on a personal bank account as a „salary‟, withdraws most of money in cash
immediately after the transaction (the „commission‟, typically approx. 8% is often maintained in the bank account),
and sends the money through money remittance abroad. Typically the true beneficiary of the transaction is a
criminal and the scheme is used to launder money originating from internet fraud (phishing).
Source: Cyprus.
70. Yet another commonly reported method involves the use of a third person to transfer funds.
Transactions carried out by the customer using (without a reasonable basis) multiple branches or
agencies and third parties (for example relatives, minors) on behalf of another person are often aimed
at concealing the sender and/or receiver (true beneficiary of the transaction).
71. Another way the MR/CE services may be misused in order to facilitate criminal or terrorist
access to the financial system is through schemes with multiple money remittance transactions
between persons not directly related. A reporting entity is not always able to effectively determine the
connection between the transfers of funds and the related reason of the customer that sends or receives
the funds. It is particularly difficult to understand the origin of the money and the scope of the
transactions. For example, money transfer transactions initiated over a short time period by several
persons to beneficiaries known to be linked to organised crime, executed in certain areas (in case of
drug trafficking, in ports, for example), sent to „dangerous‟ destinations (known as drug trafficking
routes for example) should raise the concern of the remitter. It is often difficult for law enforcement
agencies to detect whether the transaction is of a legal nature (for example, persons working abroad
and sending income to his/her family via MR services) or as part of an illegal network (forced
transactions, for example in relation to prostitution/human trafficking).
24 - © 2010 MONEYVAL and FATF/OECD