Monday, March 20, 2023


When you go to law school you learn black-letter law and issue perception, but you generally do not learn the practical aspects of the practice of law. In the compliance world, you are taught how to access resources for Customer Identification Procedure and for transaction monitoring, but you are not taught nearly enough about tradecraft, the actual methods and techniques that laundrymen have been using successfully for decades.

For example, while the basics of trade-based money laundering are delivered, such as the use of a program that detects variations in pricing of more than five percent, the fact that laundrymen routinely employ a number of high-effective methods where they do not change the prices of the goods from what the market in that industry demands is not detailed in either lectures or in written material. For example, launderers have been known to move money through several different banks, all employing a single legitimate shipment as the basis for the multiple wire transfers, knowing that the unrelated banks, in different states, do not normally communicate with one another on TDML issues.

The emphasis on CIP and transaction monitoring, while essential to our profession, must be complemented by an extensive knowledge of both the historical methods appearing published court decisions, as well as an understanding of what types of industries and businesses can be adapted to the needs of money launderers, who must continually create new typologies to stay ahead of compliance. The details of the most obscure and esoteric methods of money laundering must also become familiar, because it's the strange techniques that work every time they are applied, and none of them can be found in AML materials. Kenneth Rijock; .

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