LLOYD'S EXPECTED RESPONSE TO HOUTHI ATTACKS IN BRITISH OIL TANKER AND US WARSHIP WILL CAUSE FURTHER DISRUPTION TO MARITIME ROUTES, PROVIDING ADDITIONAL COVER FOR TRADE-BASED MONEY LAUNDERING OPERATIONS

MARTIN LUANDA

The end of this week saw increased maritime military operations launched against vessels by the Houthis, now redesignated a terrorist organization by the United States. Not only did the Houthis attack and set a British-owned oil tanker (Martin Luanda) on fire, they fired a ballistic missile at a United States Navy warship (USS Carney) for the first time. You can be certain that the underwriters and reinsurance specialists at Lloyd's, who closely monitor all maritime risks, have already made major adjustments, driving those shippers who previously accepted the increasing risks associated with Suez Canal use, to take alternative routes to Europe and the Western Hemisphere.

As we have previously explained, in "Expect Laundrymen to use Changed Conditions... to Shield Trade-Based Money Laundering Operations" (January 12, 2024), money launderers who focus on the use of TBML to clean and transport the proceeds of their clients' crimes have most certainly responded to previous Houthi attacks, and the resultant confusion in the rapid alteration of current trade routes from Asia, to modify their operations. Their adaptive and innovative nature of placing dirty money in new ways taking advantage of the chaos, will result in the reduction of risk that compliance officers will detect their schemes.

Now, with these new violent attacks upon new targets, rendering the region increasingly dangerous, expect laundrymen to further modify their methods, correctly anticipating that compliance officers will not find their funds in the increased confusion, as traditional TBML Red Flags, or indicia, can no longer be relied upon during transaction monitoring.
Remember that "the best time to rob a bank is in the middle of a war" has a maritime equivalent, and you can expect to see it here in modified TBML tactics, which will unfortunately be eminently successful in 2024.