If you still haven't read my autobiography about my decade as a career money launderer, The Laundry Man (Penguin Random House UK), and are attending next week's ACAMS Las Vegas event, come to the SOCURE booth on October 2nd and 3rd, where I will be on hand to take your information, and send it to you, with my compliments.
If you are planning on attending my upcoming lecture Insights from a Reformed Money Launderer, about the active CIP Countermeasures employed by money launderers, and available remedies for compliance experts, sponsored by SOCURE, on October 2, 2023 at 12:00 Noon, at ACAMS Las Vegas, here is the link to access to reserve your seat.
https://offers.socure.com/
Please be advised that seating is extremely limited for this luncheon event, and without a prior reservation, you will be limited to available Standing Room Only. If you wish to attend, kindly reserve forthwith. Thank you for your interest.
The only presently working former career money launderer who trains and advises the private sector and law enforcement, Mr. Rijock, a former bank lawyer in Miami, spent a decade moving the proceeds of narcotics crime into the tax havens of the Caribbean. After serving a Federal Prison term for RICO, he has been a Financial Crime Consultant for the past 30 years. He testified three times before committees of the US Congress, on pending legislation that later became part of the USA PATRIOT Act of 2001. His autobiography, "The Laundry Man, " published in 2012 in London by Penguin Random House UK, is available in six other European languages and in Chinese. He has lectured and trained in AML/CFT in more than 100 countries.
A former laundryman analyzes advanced money laundering techniques – what Swiss Bankers and Asset Managers should watch out for.
kaisin. seefeld
24 Kreuzstrasse 8008 Zürich SwitzerlandUnique Challenges and Red Flags across borders in AML - For Asset Managers, Swiss Bankers and Financial Services professionals for working with Global and American investors.
Join us for a presentation by Kenneth Rijock – a former career money launderer, who will present some of the actual strategies and techniques of money launderers used to outsmart compliance systems. With real life stories. We will also highlight the threats Asset Managers, Swiss bankers and financial service providers can encounter when dealing with American investors. The objective is to present a guide to understanding some of the sophisticated methods used by money launderers and financial criminals that pose risk to you and your institution.
Get insights directly from a former money launderer, arm yourself with knowledge that can help defend your operations from potential vulnerabilities. Plus some of the tools to detect and combat these threats.
For our audience with an interest in both US clients and investors around the world, we will highlight some universal red flags that signal trouble in funds, irrespective of their origin. The objective of the presentation is to help you recognise the danger signs in order to safeguard from potential risks.
Be prepared to reevaluate your strategies and defenses.
This will be both a physical and virtual event.
Kenneth will be presenting from Miami over Microsoft Teams lectures.
The link to the virtual event will follow after registration closer to the date.
Following the presentation, we will open a general discussion round, you have the opportunity to ask Kenneth Rijock questions and of course, us.
Apero, food and drinks will provided.
Because we are a small company, we are charging a participation fee of CHF 70.-- to help cover costs of the venue and of course, the presenter.
Amazon book link "The Laundry Man" is here.
And the link to Kens blog is here.
The only presently working former career money launderer who trains and advises the private sector and law enforcement, Mr. Rijock, a former bank lawyer in Miami, spent a decade moving the proceeds of narcotics crime into the tax havens of the Caribbean. After serving a Federal Prison term for RICO, he has been a Financial Crime Consultant for the past 30 years. He testified three times before committees of the US Congress, on pending legislation that later became part of the USA PATRIOT Act of 2001. His autobiography, "The Laundry Man, " published in 2012 in London by Penguin Random House UK, is available in six other European languages and in Chinese. He has lectured and trained in AML/CFT in more than 100 countries.
If you didn't take the time to read our articles about a Miami civil suit against 98 Barbados government officials and attorneys, you missed one of the more important fraud stories to come out of the Caribbean in recent years. In a number of jurisdictions, avaricious local lawyers seeking their fortune in places where local landowners are traditionally uneducated, and attorneys enjoy privileged status, free from bar association and court ethical and legal constraints, organized real estate and probate fraud, on a massive scale, has resulted in their illegal acquisition of valuable oceanfront real estate.
These lawyers then want to sell off that property to foreign hotel chains, high net worth foreign nationals, and other affluent investors. Their ownership claims to that real estate is completely void, as they maneuvered title transfers through fraud, forgery, or internal manipulation of local real estate records. Inasmuch as there is a dearth of title insurance companies in these tiny countries, there's no way to reduce risk that real property purchases, even from professionals known in the community, will confer good and marketable title.
Regular readers of this blog may recall that we exposed this widespread fraud over in neighboring St. Lucia a while back; those articles resulted in an abrupt regime change in that East Caribbean country. Unethical lawyers causing rudimentary real estate records to be changed when they are handling probate matters of deceased individuals whose families have owned waterfront property for generations later find that attorney-criminals have caused ownership to appear in their own names, or those of their nominees, only to sell off former plantations to unsuspecting British and American hotel chains, who later learn about title issues.
When these Caribbean lawyer, flush with cash from the sale of property they claim as their own, seek to open accounts in UK and North American banks, compliance officers responsible for Source of Funds and Source of Wealth inquiries generally accept such deposits without question. Unfortunately, they are merely assisting these lawyers with money laundering, and reputation damage could ensure later when the scandal involving probate fraud abroad appears in the media. Beware lawyers from Caribbean jurisdictions with dysfunctional economies attemting to deposit huge sums in your bank.
Today's news included a story detailing how DHRUV JANI, a citizen of India, received a ten (10) year sentence in US District Court in Colorado, after entering a plea of guilty to Conspiracy to Commit Money Laundering. Jani, who was part of a despicable group of criminals who impersonated Federal law enforcement officials, and extorted money from individuals who were told they would be deported if they failed to pay "The Government" a large sum of money. They took over a million dollars from their frightened victims, while claiming to be active duty FBI, DHS, FBI and SSA agents.
Are money laundering sentences, which could be for twenty years' imprisonment, but rarely, if ever, are handed down in that figure, finally going to fit the seriousness of the crime? We certainly hope so. Our readers just saw us tell a Miami story of a laundryman who, having served a relatively short sentence, committed a new laundering offense while on Supervised Release! These short sentences do NOT serve as a deterrent to other who might be tempted to commit the offense. We ask only this of the Federal Bench: let the punishment fit the crime . To do otherwise only causes new laundrymen to be born each day, and AML/CFT compliance is hard enough now, without having more on the street, moving cash.
The seizure of $2.4bn in assets in a major Singapore money laundering case that we have been reporting on, where Chinese nationals holding both CBI passports from the Caribbean, as well as Asian passports from all over the region, committed financial mayhem in the tightly-controlled island nation, has resulted in some Singaporean banks closing the accounts of foreign nationals holding what it calls investment-linked passports, apparently the latest means of describing economic/CBI passports from nations different from those of their birth. The arrest of a large number of alleged financial criminals definitely has upset the authorities in Singapore.
Whether this is the shape of things to come we cannot say, but given the reputational damage reportedly sustained by Singapore's financial structure by this Chinese organization, we expect that the closure there of accounts of individuals with Citizenship by Investment (CBI/CIP) passports will become widespread. Will the trend spread to other jurisdictions? We cannot say, but we will be watching.
Remember, The United Kingdom recently terminated Dominica's visa-free entry for its passport holders, due to the torrent of financial crime being committed by individuals Dominica CBI passports. Some of the arrested Chinese money launderers in Singapore had Dominica CBI passports. Connect the dots please, gentlemen; these passports may now be on the endangered list.
Sometimes, even medium sentences for money laundering fail to serve as a deterrence to career money launderers. Take CARLOS ALBERTO PADRON, sentenced to federal Prison for money laundering for 97 months. When finally released, and under Supervised Release, he goes right back to a life of financial crime. We see he has just now pled guilty, in SDFL, to yet another money laundering charge, in this case for laundering the proceeds of Medicare fraud.
The second indictment is, of course, a violation of his Supervised Release. So, he is sentenced to 70 months on the new charge, while another judge tacks on 20 months for his violation of Supervised Release, the modern form of post-conviction supervision, where you must not violate the law He now got 90 months. If the original sentences for money laundering would start approaching the 20 year maximum, perhaps prospective laundrymen might just be deterred from committing more crimes. Make the punishment severe, and you eliminate recidivism, in my humble opinion. If you are doing 20 years, you will not be back in circulation laundering the proceeds of crime again. Nobody in the Department of Justice seems to understand that.
I was perplexed this morning when Sam Bayat sent me an article, written by a Los Angeles-based attorney handling Citizenship by Investment (CBI) passport applications, suggesting that his clients might be required to obtain a clean FBI criminal history report when seeking an economic passport.While the absence of felony convictions might be a requirement for "Golden Visas" issued by the Members of the European Union, I assure you that, to the best of my knowledge, NONE of the five East Caribbean states that sell CBI have ever required anything close to this FBI certificate. Telling clients that such may be required is inaccurate, even today in 2023. Please show me where such is currently a requirement on any application.
To the contrary, ineffective due diligence performed by government agencies processing CBI passports and citizenship in the East Caribbean have sold passports to international fugitives, sanctions evaders, convicted white collar fraudsters, terrorist financiers, radical linked to designated terrorist organizations, citizens of countries named as State Supporters of Terrorism, and many other types of the Usual Suspects that are totally unqualified to apply for a CBI passport, which they use to conceal their true identities.
For those whom the origins of CBI are before their time, allow me to walk down memory lane a bit, and relate where it all began. It was St. Kitts & Nevis that was the first jurisdiction to offer Citizenship by Investment passports, now known as CBI to some, CIP to others. It was the Foreign Minister at SKN, the Honourable William Herbert, Jr., known one and all in Basseterre, and also over in Anguilla, where he also maintained a thriving legal practice, facilitating money laundering operations of his many clients, yours truly included, as Billy Herbert who introduced me to such useful identity identity documents.
Dr. Herbert advised that he would personally facilitate expedited processing of my clients' applications, so when a client.in this case the late Georges Krancenblum, returned from Panama with passport-friendly photographs of a number of individuals in his organization, plus certain individuals who were leaders in the Medellin cartel, from whom he purchased his cocaine, I started the application process, seeing that a large amount of US Dollars was deposited in shell corporation accounts in a certain bank in Anguilla.
When, as often happened in that business, those clients were indicted in Federal Court in the Southern District of Florida,, and many were forced to flee the jurisdiction, I was required to advise Dr. Herbert of the situation, His response was that I should secure some form of clean bill of health, from a place where their new criminal history was not yet known, to complete the application process. wisely, I chose not to proceed, and that's one of the reasons why I am here to relate that tale today, and was not caught up in the subsequent cases involving the Cartel's leaders.
Has it really changed that much since 1982? In my humble opinion, the answer is sadly, no. Money talks very loudly in the East Caribbean CBI jurisdictions, and if you doubt it, start reading all the articles I have published over the last 20 years about criminals employing CBI passports with impunity, on a global basis, especially in the developing world, but also everywhere in the European Union. Those passports remain instruments of white collar crime, sanctions evasion, terrorist financing, and everything else that the Usual Suspects use them for. Nothing has changed.
In order to mitigate risk as compliance professionals, you need to learn to think like a bad guy. What better way to do that than to hear from a former money launderer?
Gain a unique perspective on the intricate world of financial crime as a reformed money launderer, Kenneth Rijock shares his insights in this eye-opening discussion with Debra Geister, Vice President of Compliance Solutions at Socure.
Discover the elusive tactics employed by financial criminals to sidestep Customer Identification Programs (CIP) and delve into the preventative solutions available to compliance professionals. This informative exploration bridges the gap between the shadowy world of financial criminality and the strategies that can empower compliance professionals to safeguard against it.
Presenters:
Kenneth Rijock, “The Laundry Man”, Financial Crimes Consultant
Debra Geister, Vice President of Compliance Solutions, Socure
*Pre-registration confirmation required. Seating limited.
We note the barrage of so-called "news articles" appearing of late, mainly appearing on the websites of the Citizenship by Investment (CBI/CIP) passport sales industry, extolling purported reforms now being implemented by the five East Caribbean states that sell economic citizenship. Claiming to be a response to UK and EU demands for meaningful reform of an industry that has a long and sordid history of selling its passports to career financial criminals, international sanctions evaders, and corrupt Politically Exposed Persons (PEPs), these jurisdictions have yet to show that they have enacted any significant changes, as news reports continue to note the global arrests of individuals literally caught in the act of criminality, holding these identity documents when captured by law enforcement. Their claims that the industry has cleaned up its act are not only untrue, but amount to little more than propaganda. Compliance officers should not be taken in by a clever PR campaign.
CBI passports continue to pose a clear and present danger to international banks, as they allow criminals, and others with dark intent, to conceal not only their true nationality, but their actual identity as well. They serve as a a visa-free tool to enter the UK and EU at will, to commit whatsoever criminal acts they wish, especially money laundering, with impunity. There;s good reason that the UK recently yanked Dominica's visa exemption for its passport holders. Compliance officers must ignore what is essentially industry propaganda, and to continue to regard the individuals who present with "economic passports" as potential criminals that are high risk, as many have proven to be since the early 1980s, when St. Kitts became the first Caribbean jurisdiction to sell passports to all who apply, no questions asked, so long as they had cash in US Dollars.
Furthermore, legitimate investors, who come from jurisdictions where their nationality forces them to apply for visas through lengthy application policies, and who simply want to enter Europe through a seamless process, are not being properly advised by an industry that neglects to inform them that the mere possession of CBI passports can increase their risk of being lumped in with the criminals who abuse those identity documents. Such dangers, including the risk of law enforcement targeting, is not communicated to those affluent individuals who que up to purchase them. Again, an industry that overcharges its clients, often concealing obscenely high commissions, fail to make them educated consumers of these documents.
Compliance officers, kindly note: the game remains the same in the East Caribbean. Sell as many of these CBI passports, to whomever applies, so you can fund your dysfunctional failed local economies, all swollen with a surplus of government positions that serve to employ your people, as there is little in the private sector to provide all of them with income. There is no meaningful reform, and a large percentage of these passports are in the hands of individuals that you do not ever want as bank clients. Govern yourself accordingly.
While the economic citizenship industry frets about the possibility that the European Union may discriminate against Citizenship by Investment (CBI) passport holders in 2024, when ETIAS, the Schengen Zone's own Electronic Travel Authorization program ,is due to come into effect, there is an unexpected benefit from ETIAS of major interest to both EU law enforcement and the compliance community: the system, when paired with Artificial Intelligence platforms, will be able to identify, and therefore interdict, money launderers using such identity documents to enter Europe.
A close look at the ETIAS system reveals that individuals not born in the countries in which they hold citizenship and nationality, meaning passports, will be identified through the information gathered, as well as the passports presented for approval. In truth and in fact, EU ETIAS staff will have the ability to cull out those individuals, and request additional information, while preliminarily denying them the routine visa-free approval granted to legitimate applicants.
This means that individuals who have acquired passports through CBI means will face secondary scrutiny, and given the recent advances made in Artificial Intelligence in quickly and efficiently gathering relevant information not previously available, should be capable of not only identifying financial criminals with a high degree of certainty, thereby leveling the playing field, which has traditionally favored enterprising money launderers seeking to enter the EU from abroad. We welcome this new development, as it may prove to be critical in assisting European law enforcement in reducing the rampant money laundering which has infected Europe for decades.
For those who worry that naturalized citizens may be caught up in a dragnet designed to snare money laundering and financial criminals, attention will be focused upon only those present or former CBI jurisdictions known to sell passports & citizenship to unsuitable (i.e. criminal) applicants, like MALTA, ST. KITTS & NEVIS, ANTIGUA, DOMINICA, ST. LUCIA and GRENADA, together with some additional countries, principally in Asia and the Pacific. Legitimate naturalized citizens will have nothing to fear from ETIAS.
If you think that this is a far-fetched concept, the United States itself uses its ETA program to identify individuals who have found "creative' methods of acquiring passports from visa-free jurisdictions, using the same investigative methods and techniques to extract information on potential financial criminals that the EU will soon have in place when ETIAS goes live, sometime in 2024, literally taking a Bite out of Crime.
Mark Camilleri, a former senior leader in Malta's Labour Party, who regularly exposes official corruption amongst his former party, and who has now acquired a reputation as an effective whistleblower in money laundering matters, has alleged that Maltese millionaire YORGEN FENECH, now awaiting trial for his alleged involvement in the assassination of investigative journalist DAPHNE CARUANA GALIZIA, attempted to move Ten Billion Dollars (USD$10,000,000,000) into a small European private bank, for a Middle Eastern billionaire, when he was arrested in Malta. The transaction, which flies in the face of not only sound banking practices, as it was six times the amount of the tiny bank's assets, was attempted for an individual who has been linked to the disgraced former Prime Minister of Malta, JOSEPH MUSCAT. Fenech and Muscat, you will recall, are both connected to the Egrant/17 Black corruption scandal.
Muscat, once identified as the most corrupt public leader in the European Union, has known this mysterious individual since he came into office a decade ago. The deposit itself, given the client's background and history, raises questions of money laundering and corruption. The bank, diminutive BANQUE HAVILLAND (Liechtenstein) AG, of Luxembourg, has strangely taken the deposit in its Monaco office. Fenech, who is known to have holdings in Monaco and southern France, has been a close associate of Muscat for several years, and is believed to have been a significant factor in his original election to the premiership. As Mr. Camilleri correctly says, private banks are often used for money laundering; neither Liechtenstein nor Monaco are Members of the European Union.
Fenech remains in custody in Malta, so Muscat's role in the matter has now come under scrutiny in the EU compliance community. Whether this obscenely huge, and unusual, transaction signifies we cannot say. Cash deposits of this magnitude, which generally precede major acquisitions, reportedly remains within the bank, for no apparent legitimate business reason. What is this money to be used for? we cannot say, but suffice it to say we will
The passage of time may have healed some of the wounds America suffered on 9/11, but the existential threat of terrorist financing remains a clear and present danger in 2023. Funding of Hezbollah, Hamas, a weakened Al-Qaeda, and all the other designated global terrorist organizations goes on each day, without sufficient CTF countermeasures to interdict and suppress all those millions of dollars that support them. While compliance officers focus on money laundering, they must not forget that the more difficult to uncover terrorist financing operations are still a challenge that they need to meet and overcome each and every day.
On a personal level, I still think of my friend, Port Authority Police Director of Public Safety Fred Morrone leaving his office in New Jersey, and going into the Towers to save those people. May his memory be a blessing.
Doubling the prices for their Citizenship by Investment (CBI) citizenship and passports, which the Federation of Saint Christopher & Nevis recently announced, may fill the coffers of the island nation's perennially-empty treasury more rapidly than before, but it will most likely cause SKN's East Caribbean competitors, Antigua, Dominica, St. Lucia and Grenada, to take similar steps, as their leaders are just as avaricious as those in power in Basseterre. Don't they realize what this will do?
When CBI passports become prohibitively expensive, normal, legitimate buyers will eschew them for less costly "golden visa" programs in other jurisdictions. Besides, the East Caribbean "CBI republics" have quickly forgotten that both the European Union and the United Kingdom are sick and tired of transnational criminals, corrupt PEPs, and sanctions evaders using those identity documents for visa-free entry into Europe. Sooner or later, Caribbean CBI passports will NOT give the holder a pass on qualifying or, and obtaining, a visa. Legitimate High Net Worth (HNW) clients, who can afford anything, will ignore the Caribbean passport, calculating that its usefulness for visa-free entry is coming to an end, sooner rather than later.
So who is left? The criminal sector, which can generally afford just about anything, and will use the Caribbean CBI passports short-term for lucrative criminal purposes. if you think those passports have a bad reputation now, wait until only those who are criminals have them, and use them to facilitate money laundering, major fraud, terrorist financing, and other dark deeds. Then, expect swift retribution from London, direct or indirect, with the EU not far behind.
I understand that the dysfunctional, failed economies of the East Caribbean states need cash to pay their grossly swollen national budgets, which employ their population, who might otherwise be unemployed, but this raising of retail prices for economic passports will just hasten their demise. Do you really want your countries to become insolvent in 2024?
In the aftermath this week of America's Labor Day holiday, I am wondering whether it might be a smart move for compliance officers in the United States to seriously consider forming a union to protect their professional, as well as personal, rights. Over the years, I have observed that, since most compliance officers have no employment contract ( they are happy just be be employed) and therefore serve at the will of the bank where they toil, their job security is tenuous, at best. Allow me to bring up a few key points; before you object, go do your research. There are banks where the staff are unionized, and that arrangement doesn't seem to be a problem. Read on.
1. Zealous compliance officers doing their gatekeeper jobs are sometimes threatened with termination, when withdrawing an objection to account opening can later be considered by law enforcement to be Willful Blindness, which you should know ends up as a money laundering indictment against you, personally, while the New Accounts staff who forced you to back off is ignored.
2. Union activity, which is protected by Federal law, gives compliance officers in different banks a legal excuse to talk or network with one another, whether that be to compare notes on software, discuss CIP and transaction monitoring policies & procedures, conduct professional education, and a larger number of topics while on the job. They would have a reason, outside of industry conferences, to contact one another.
3. A union could be a powerful advocate for establishing fair compensation in the industry, for assisting terminated compliance officers with employment issues, and for leveling what is currently an uneven playing field with regard to negotiating salary and benefits.
4. A bank whose executives are more concerned with maximizing profits would think twice before regularly overruling compliance onboarding decisions of their compliance officer, if he or she could then generally share dangerous bank policies with union leadership, which would educate its membership about the dangers of working there.
If this is this too adversarial a viewpoint, a union of compliance officers could set down industry employment guidelines, which the banks might be inclined to follow, if they wanted to attract talented and competent staff to their compliance department. Think about it.
The statements of the Five East Caribbean states which offer passports and economic citizenship to foreign nationals under their CBI programs, to the effect that they have reformed their application process to exclude unqualified and criminal elements apparently have no basis in fact. Criminals can still acquire these valuable identity documents with impunity, provided they are able to quietly pay a premium in cash, namely in US Dollars, to intermediaries who are linked to senior government officials. The situation revealed in the expose' of how career criminals, sanctions evaders and corrupt Politically Exposed Persons (PEPs) are able to buy CBI passports in the region, by Aljazeera, which alerted compliance officers to the danger, remains a clear and present threat in 2023, notwithstanding extensive public relations campaigns touting reforms by St. Kitts, Dominica, Antigua, St. Lucia and Grenada.
We have a report this week that an American law enforcement officer, working undercover in the Commonwealth of Dominica, was approached by a cousin of the country's Prime Minister, ROOSEVELT SKERRIT, after making it known that the agent had a relative with a long criminal record who needed a passport under an alias. The agent was offered a CBI passport, no questions asked, even after disclosing his purported relative's criminal convictions.
The terms and conditions for purchase were extremely disturbing: if the buyer paid USD$80,000, in cash, he would be "qualified" by Skerrit to be approved on an application for a CBI passport and Dominica citizenship. The money, in cash, was required to be paid to the cousin, not in Dominica, but over in neighboring Antigua & Barbuda, obviously to foil any potential witnesses to the payment.
As this case demonstrates, it's still business as usual in the East Caribbean, and the business of selling passports to literally anyone who has the financial means, remains the policy of those governments.
