Wednesday, November 22, 2023


Money launderers are always in search of new business, industries and even professions, when looking to create unusual opportunities to clean drug profits quietly. This week, a major American sneaker and athletic gear retailer in Charlotte was charged in a case that reportedly saw thirty two million dollars in narcotics profits turned into grey-market sales of high-end sneakers to a Chinese money laundering organization tasked with laundering narco-profits. The principal of the American company routinely accepted large cash payments, in excess of $10,000m while illegally funneling consumer products abroad, in violation of his agreements with manufacturers of athletic equipment.

Compliance officers need to understand that money laundering is a dynamic intellectual exercise conducted by the laundrymen, to constantly explore new potential avenues in legitimate industries and businesses not previously exploited for criminal purposes. They know that most low-risk businesses, which are not known for engaging, wittingly or unwittingly, in money laundering operations, are rarely suspected by compliance, and therefore ripe for access. As I am fond of repeatedly mentioning, money launderers stay up nights and weekends to contrive new techniques, involving industries that they are not known to have used in the past, to confuse not only law enforcement agencies, but bank compliance departments as well. 

I know this because I was a participant in that dirty profession for a decade, during which time it schemed and brainstormed my way through literally dozens of scenarios, in my quest to find bulletproof methods and techniques of money laundering. I often twisted and modified known techniques, and tried to apply them to new business types, all in an effort to create a system that compliance officer would never recognize as money laundering operations. Think about that when you see a possible suspicious transaction in a low-risk industry, before you abruptly dismiss it as a single anomaly. it may be evidence of a minor error or mistake that a money launderer let pass in an otherwise perfect operation. Look for it. 

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