In recent years, money laundering schemes have found their way into the spotlight through various news leaks. Specific disclosures from renowned lists have recently exposed various laundering schemes, including the Panama Papers and Wikileaks in 2010. These schemes bring questions to light, like why do US firms use places like the Bahamas as offshore financial centers? This list is known as the Paradise Papers.
The US dollar is one of the most important currencies worldwide – If not THE most important currency overall. The US dollar is also one of the most important currencies for money laundering and US money laundering is already a global concern.
Obviously, this is closely related to the US of the US dollar in international business dealings. According to research, 87% of global foreign-exchange transactions involve the US dollar. Researchers also observed that at least 80% of trade finance dealings were conducted in USD. With other currencies settling at around only 5-10%, the US dollar dominates the financial world of trade.
The prominence of the US dollar makes it prone to money laundering.
In 2017, the New York Department of Financial Services (NYDFS) released newly updated Anti-Money Laundering (AML) requirements. These AML regulations aim to decrease the consequences of money laundering in criminal areas such as drug trafficking, human trafficking, terrorism, and other illicit undertakings. Notably, New York AML regulations have a significant global impact.
In recent times, anti-money laundering legislations have prolonged reach to non-financial corporations, including developing to prevent money laundering through casinos, including those in the infamous Macau. However, the Congressional-Executive Commission on China reports that $202 billion illegal sourced funds are moved through Macau each year, including casino laundering.
Compliance is a defensive wall against financial crime and money laundering, but it places quite a toll on banks and financial institutions. A failure to comply with applicable laws and regulations might result in hefty fines. Most of last year’s fines relate to non-compliance with AML or KYC legislation. However, there are lessons learned that can be taken away!
As online transactions become more widespread, vendors have to watch out for increasing threats every day – especially money laundering red flags arising from the use of cryptocurrencies like Bitcoin and others!
Money launderers are acquiring more and more ways to exploit systems anonymously – especially with cryptocurrencies.
The Covid-19 pandemic has affected lives in a multitude of ways. Since March 2020, the rate of cyber-crimes has been estimated to increase by 42%, making substantial use of money mules.
With the continuing rise of technology, it comes as no surprise that video games are an expanding source of profit. Video game fanatics are finding even more ways to enjoy their favourite games – buying characters online for billions of dollars every year.
With the issue of “dirty money” seemingly being worldwide, it comes as no surprise that even the least corrupt countries come face-to-face with the problem. Money laundering spares no countries and seems to find its way into less corrupt nations, even more so than others.
With this blockchain technology guide you’ll become a compliance professionals that understands blockchain technology from a compliance perspective.
Serious about fighting financial crime?
Sign up here and join the Financial Crime Academy Community to receive the latest updates