Kenneth Rijock

Kenneth Rijock

Monday, November 7, 2016

ARE YOU BANKING ANY JAMAICAN MONEY LAUNDERING OPERATIONS ?

Coat of Arms of Jamaica

In a recent lecture given in New York to expats, the Jamaican Ambassador to the United States disclosed that, over the past ten years, 20,000 Jamaican nationals have been deported from the United States. While she was quoting that disturbing statistic, in connection with her campaign to encourage Jamaican parents living in the US, to send their children to college, and to learn a marketable skill, for a constructive purpose, it also exposes a darker side, that American bankers might want to pay close attention to.

Many young Jamaican children emigrated to the United States, with their parents, at a very young age, and obtained permanent residency here. What they did not generally do, when attaining the age of majority, is process for citizenship. When many, without jobs or educations, engaged in drug trafficking, after their conviction, they found that their "Green Cards" were revoked, and that they were summarily deported to the country of their birth, where many continue to live a life of crime. The Ambassador stated that 90% of Jamaicans deported from the US were expelled for drug crimes, mainly involving marijuana and, to a lesser extent, other "consumer" narcotics.

Twenty thousand drug dealers, couriers, traffickers and smugglers means a lot of criminal proceeds, much of which must be repatriated back to its Jamaican kingpins. While we have seen a couple of arrests, involving bulk cash smuggling attempts, from the United States, most of the narco-profits have never been seized, and presumably made it back safely to Jamaica.

Just how would an enterprising money launderer successfully send his clients' drug profits back home ? There are many methods available:

(1) Wire transfers, ostensibly to "purchase" Jamaican products, for shipment to the United States, or other countries. The manufacturer then goes out of business, into a contrived bankruptcy, or suffers a loss making shipment impossible, or indefinitely "delayed."

(2) Transfer pricing, or trade-based money laundering.

(3) Conversion of profits to another, more useful currency, and then shipment, well hidden within consumer goods, to Jamaica, as part of a bogus export scheme.

(4) Transmission of "profits," to Jamaican owner of US-based cash-intensive business, from the company's treasury.

(5) Bogus charitable organizations, sending "donations" to sister organizations in Jamaica.

(6) The use of nonprofits, ostensibly engaged in good works in Jamaica and the Caribbean to fund, or overfund, projects within Jamaica.

The possibilities are are as endless as the fertile (but criminal) minds of the money launderers employed to accomplish those illegal tasks.This presents a potential risk that should be carefully assessed.

 As a banker in North America, and without profiling Jamaican business accounts for any discriminatory purpose, you should examine any substantial business client, whose ownership appears to be by Jamaican nationals, or corporate entities based abroad, to rule out the possibility that the company is a front for an advanced money laundering operation, sending drug profits back to its Jamaican owners, right under your nose.

 Is the conduct of the business clearly inconsistent with others in that trade or industry ? Are their international transactions that do not have a profitable purpose ? Are the officers and senior leaders not working in the US, at the company's principal offices ? have you actually been to the site, to observe that the business is active and in operation ? Obtain these answers before concluding that it is a legitimate business client. If there are too many red flags, institute enhanced due diligence, using a competent, independent resource for the task. 

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