Money Laundering Concerns Persist Amid Pandemic
Despite the challenges posed by the COVID-19 pandemic, money laundering concerns continue to persist in various sectors. A recent report from the Financial Intelligence Unit (FIU) highlights several key trends and statistics that shed light on these ongoing concerns.
Suspicious Transaction Reports
The FIU’s latest report reveals that commercial banks and gold dealers accounted for nearly 95% of all suspicious transaction reports (STRs) received in 2020. This trend suggests that these sectors remain attractive avenues for money launderers.
- Top Reasons for STRs: “Smurfing” and “structuring of transactions” were once again the primary reasons for STRs, accounting for approximately 62% of all reports received.
- Monetary Value of STRs: These activities also represented 15.5% of the monetary value of all STRs.
Romance and Package Delivery Fraud Schemes
The report notes that reports of romance and package delivery fraud schemes increased significantly during the pandemic, driven by the surge in internet use for work and leisure. This category accounted for an alarming 80% increase compared to 2019.
Commercial Banks and Gold Dealers
The FIU’s report also highlights that commercial banks and gold dealers were responsible for a substantial portion of all STRs received in 2020. “Smurfing” and “structuring of transactions” were the primary reasons for these reports, indicating ongoing money laundering concerns in these sectors.
Terrorist Property Reporting
Meanwhile, no Terrorist Property Reports (TPRs) were received by the FIU in 2020. However, reporting entities are required to submit TPRs without delay if they have knowledge that a designated person or entity is attempting to carry out a transaction or has funds or assets of a designated person or entity.
Threshold Transaction Reporting
Despite the pandemic’s impact on economic activity, the total number of threshold transaction reports submitted by reporting entities increased 19% compared to 2019. However, the total value of these transactions decreased 21%.
- Top Categories: Money transfer transactions, cambio transactions, and large cash deposits accounted for approximately 91% of all threshold transactions in 2020, similar to 2019.
- Value of Threshold Transactions: These three categories also represented around 90% of the value of all threshold transactions in 2020.
Analysis
The variances observed in threshold reports between 2019 and 2020 are partly attributed to changes in economic conditions associated with the emerging oil and gas industry and restrictive measures imposed due to the COVID-19 pandemic. However, the significant increase in gold declarations remains unclear.
Key Statistics
- Commercial banks and gold dealers accounted for nearly 95% of all STRs received in 2020.
- “Smurfing” and “structuring of transactions” were the primary reasons for approximately 62% of all STRs.
- Reports of romance and package delivery fraud schemes increased by 80% compared to 2019.
- No TPRs were received by the FIU in 2020.
- Threshold transaction reports submitted by reporting entities increased 19% compared to 2019, but the total value decreased 21%.
- Money transfer transactions, cambio transactions, and large cash deposits accounted for approximately 91% of all threshold transactions in 2020.