EVOLVING MARKETPLACE CONDITIONS INCREASE THE RISK THAT COMPLIANCE OFFICERS PERFORMING TRANSACTION MONITORING WILL SEE MORE MONEY LAUNDERING THROUGH LIFE SETTLEMENTS

As complex market forces force smaller and independent firms selling Life Settlements to investors out of business, the giants in the industry gobble up the inventories of their former competitors. Inasmuch as there are no regulations requiring that Life Settlement companies maintain an effective AML/CFT program, the odds that enterprising money launderers were in the past able to embed their criminal clients into a significant number of investments at the now-defunct little companies, is significant.

When those investments are sold by failing Life Settlement firms to the bigger players in the industry, there is no compliance done on the existing investors, and when the investments mature ( the insured on those large policies pass away), and the insurance carrier which issued the policies pay off what can be millions of dollars, the Proceeds of Crime are artfully cleaned and laundered.

I bring this up, as most compliance officers accept eight-figure payments from the world's largest life insurance companies without any further inquiry, believing, in error, that sufficient due diligence was previously completed, when in truth and in fact, only the original beneficiary was vetted, not the successor, which was precisely where the money launderer was able to work his magic, in the secondary market for life insurance that is the Life Settlement industry.

If you do not have a thorough understanding of Money Laundering through Life Settlements, you might want to seriously consider attending my upcoming January 20th virtual seminar on advanced, esoteric and obscure money laundering techniques. You can obtain details here:

https://titc.io/kenneth-rijock-the-laundry-man

TO CATCH A MONEY LAUNDERER IN THE ACT, SEND A FORMER LAUNDRYMAN TO DO IT

It was shortly after 9/11; late one night, I received a call from a lawyer whom I had done a number of joint AML compliance lectures with. He was scheduled to give a lecture the next morning at a conference on Miami Beach, on MONEY LAUNDERING THROUGH HEDGE FUNDS, but his firm had just ordered him to immediately fly to Buenos Aires on a priority mission for a major Argentinian bank. He asked me if I was available to conduct the presentation in his place, as he knew that I was familiar with the subject, and didn't need any material from him.

After I gave the lecture, the CFO and the Director of Compliance at a billion dollar investment firm came up to see me. They had a $15m investment from a new foreign client pending, and the firm's owner wanted a second opinion from someone like myself, who has the unique perspective of having been a career laundryman, and could bring a different skill set to an enhanced due diligence investigation. The firm's lawyers had passed the client, who owned several television stations.

When conducting enhanced due diligence, you want to find your target at an unguarded moment, when he thinks nobody is looking, and where his actions might betray conduct making him an unacceptable risk. I found a photograph of the target, at the private aviation section of a major airport, waiting for someone to come down the steps to meet him; that person was one of Russia's most prominent oligarchs, and the target his front man and money launderer.

I found the client to represent an unacceptable risk, and his investment request was declined. I would go on to be hired by the company to review all its major new clients, and used my laundryman skills to ferret out the money launderers among them, which is a story that I will tell at the upcoming January 20 virtual seminar presented by TALENT IN THE CLOUD, in which you can learn about advanced, esoteric, obscure and exotic money laundering techniques that I have employed, encountered or exposed, as a laundryman, or as a Financial Crime Consultant, during the past 40 years. For details: https://titc.io/kenneth-rijock-the-laundry-man

By the way, that foreign "investor" (read money launderer), whom I exposed during enhanced due diligence, then followed the money launderer's playbook, of attempting a different approach when unable to place his client's criminal proceeds, by later seeking to place the money through the firm's Bermuda subsidiary, which had a different compliance division. To find out what happened then, and how I dealt with it, come to the seminar.

INCREASED LIABILITY OF MIDDLE EASTERN AND ASIAN CBI CONSULTANTS AND ADVISORS TO AMERICAN MONEY LAUNDERING AND OTHER CRIMINAL CHARGES AFTER US vs. MCKINSEY CASE RESULTS IN $650,000,000 DEFERRED PROSECUTION AGREEMENT PAYOUT

In what appears to be a case of first impression, a criminal Information was filed against a major American consulting firm, McKINSEY AND COMPANY, INC., in US District Court in Virginia, resulting in a global settlement that included the payment of $650,000,000, criminal charges being filed against a senior officer of the company, and an admission of the corporate defendant's liability for advice rendered to a client, a pharmaceutical firm. Readers are urged to review the Deferred Prosecution Agreement for more details; it requires the corporate defendant to commit to an extensive five year program to avoid a conviction on multiple counts. Inasmuch as a corporation is not a natural person, and cannot serve prison time, extremely close supervision, or the corporate death penalty, dissolution, which would then have followed a jury verdict of guilty.

What is unique to the case, and relevant to the situation faced by a number of prominent Dubai and East Asian Citizenship by Investment (CBI/CIP) consultancies that have engaged in the illegal discounted sale of Saint Kitts & Nevis citizenships & passports, is that one of the criminal charges filed against Mckinsey was Misbranding its clients product. The CBI consultants who sold SKN passports to consumers engaged in marketing campaigns that were deceptive, failed to disclose important facts to to prospective clients which rendered these investments high-risk for a number of reasons, and glossed over or ignored recent legal developments or actions which have now rendered their investments void, without the payment of additional funds which were never disclosed.

Given that Federal courts in the United States have consistently conferred Extraterritorial Jurisdiction upon the Money Laundering Control Act of 1986, and that CBI sales are all in US Dollars, it will be interesting to see what impact the McKinsey case has on the investigation, and ultimate criminal prosecution, of CBI consultants abroad.

HERE'S THE SYLLABUS FOR MY THREE HOUR VIRTUAL SEMINAR ON ADVANCED, ESOTERIC AND OBSCURE M0NEY LAUNDERING TECHNIQUES, AS TAUGHT BY A FORMER CAREER LAUNDRYMAN, BEGINNING JANUARY 20

For more details:https://titc.io/kenneth-rijock-the-laundry-man  

1. MONEY LAUNDERING THROUGH INTERNATIONAL PRODUCT DIVERSION.

2. MONEY LAUNDERING THROUGH LIFE SETTLEMENTS.

3. ADVANCED TRADE-BASED MONEY LAUNDERING.

4. THE LAUNDRYMAN'S VERSION OF HAWALA.

5.  MONEY LAUNDERING THROUGH FINE ARTS AND ANTIQUES.

6. MONEY LAUNDERING THROUGH CASH-INTENSIVE BUSINESSES.

7. MONEY LAUNDERING THROUGH THE MOTION PICTURE INDUSTRY.

8. INVESTING OFFSHORE ILLICIT WEALTH ONSHORE.

9. MONEY LAUNDERING THROUGH REAL ESTATE INVESTMENTS.

10. MONEY LAUNDERING AND SANCTIONS EVASION THROUGH THE USE OF CITIZENSHIP BY INVESTMENT (CBI) PASSPORTS.

11. MONEY LAUNDERING USING SHELL AND SHELF COMPANIES.

12. MONEY LAUNDERING THROUGH CORRESPONDENT BANKING.

13. HOW MONEY LAUNDERERS EMPLOY ADVANCED TECHNOLOGY TO OUTWIT COMPLIANCE OFFICERS.

14.MONEY LAUNDERING THROUGH LOTTERIES AND OTHER CASH PRIZE EVENTS.

15. MONEY LAUNDERING THROUGH THE HOARDING AND SALE OF PRECIOUS METALS AND VALUABLE STAMPS AND COINS.

16. MONEY LAUNDERING THROUGH THE USE OF DIPLOMATIC PASSPORTS BY NON-DIPLOMATS.

17.WHAT GOES UP AND DOESN'T NECESSARILY COME DOWN IN MONEY LAUNDERING OPERATIONS.

18. THE USE OF PSYOPS IN MONEY LAUNDERING TO CONFUSE COMPLIANCE OFFICERS INVOLVED IN TRANSACTION MONITORING.

19. HOW MONEY LAUNDERERS DEAL WITH IDENTITY VERIFICATION ISSUES.

20. WHEN MONEY LAUNDERERS GIVE YOU UNINTENTIONAL EASTER EGGS FOR YOUR ENHANCED DUE DILIGENCE INVESTIGATION.

WIDESPREAD LEAK OF NONPUBLIC MALTESE MAGISTRATE'S REPORT CONFIRMED BY MULTIPLE VISITS TO VIEW EVIDENCE OF NYC PROPERTY IN 2021 ARTICLE IMPLICATING MICHELLE MUSCAT

The Magistrate's Inquiry & Report, implicating former members of disgraced ex-PM JOSEPH MUSCAT's Cabinet in massive corruption, has apparently been widely leaked to the public, which has been confirmed by multiple visits to our 2021 article exposing MICHELLE MUSCAT'S purchase of real estate in New York City, with funds from the now defunct money laundering PILATUS BANK, because most probably there are references to that transfer in the Magisterial Inquiry documents.

Michelle Muscat

For those readers who have not read the article, access it here:
READ THE REAL PROPERTY TRANSFER RECORDS ON THE NEW YORK APARTMENT OF MICHELLE BUTTGIEG $790,000
https://lnkd.in/evsYbjyz

While we cannot state at this time that all the documentary evidence we reported in that article appeared in the Inquiry, we can confirm from our own personal review of a portion that there is indeed information detailing the circumstances of the transaction, which leads directly back to the corrupt regime of former Prime Minister Muscat. We wonder whether the resident of that expensive New York City apartment has now received a visit from Maltese criminal investigators.

IRAN'S RENEWED BULK CASH SMUGGLING EFFORTS TO SUPPORT A WEAKENED HEZBOLLAH, AND THE LEBANESE REACTION, EXPOSED AT RAFIK HARIRI BEIRUT AIRPORT INCIDENT

As a State Sponsor of Terrorism, Iran intends to continue funding Hezbollah; this week there was a dustup at the Beirut International Airport, when "diplomats" arriving on a MAHAN AIR flight declined to have their luggage inspected at Customs, claiming that it contained funding for the Iranian Embassy. It was highly probable that this was a bulk cash delivery to Hezbollah of US Dollars. We call this bulk cash smuggling, gentlemen, notwithstanding Iran's rights under the Vienna Convention. The luggage was ultimately admitted without inspection, but the dispute demonstrates a much more assertive Lebanese government since the terrorist organization was severely damaged by the Israel Defense Forces in 2024.

Of Note: Lebanese authorities then conducted a search of the Iranian aircraft, to insure that there were no smuggled arms & ammunition, as well as a cache of Greenbacks on board. Apparently, things have now changed in Lebanon, and the country's government intends to insure that Iran cannot openly resupply Hezbollah, whether that means war materiel or cash. We shall be closely monitoring the situation, to see what else Iran will attempt to do to aid its beleaguered terrorist ally.

MAGISTRATE IN MALTA RECOMMENDS THE FILING OF CHARGES AGAINST TWO FORMER GOVERNMENT OFFICIALS IN ELECTROGAS BRIBERY CASE, KEITH SCHEMBRI AND KONRAD MIZZI, WHO HAD PREVIOUSLY BEEN CHARGED IN THE VITALS HOSPITAL SCANDAL

PULLICINO, SCHEMBRI, MIZZI and BOLOGNA

KEITH SCHEMBRI, the former Chief of Staff to disgraced former Maltese Prime Minister JOSEPH MUSCAT, and KONRAD MIZZI, a former minister in Muscat's corrupt administration, now both face likely new criminal charges, after a magisterial inquiry recommended bribery and other charges not yet named, for their participation in the ELECTROGAS scandal, which has been the subject of numerous articles on this blog in recent years.Last year, both Schembri and Mizzi were also charged in the VITALS hospital scandal, which we have also covered here in detail on the Financial Crime Blog.

Joseph Muscat

Also named as likely ELECTROGAS case defendants are the millionaire businessman YORGEN FENECH, a suspect in the assassination of investigative reporter DAPHNE CARUANA GALIZIA, and Electrogas figures MARIO PULLICINO and PAUL APAP BOLOGNA. It was thought by most legal observers in the EU that the systemic corruption which exists in the Republic of Malta among both the judiciary and the police would bar the proper administration of justice in these corruption cases, and we welcome this new development as a step forward in the enforcement of the Rule of Law.

THE BANK OF AMERICA OCC CONSENT ORDER INCLUDES A TRANSACTION MONITORING LOOK-BACK; WILL IT RESULT IN THE CLOSURE OF THE BANK'S CARIBBEAN CORRESPONDENT ACCOUNTS, DUE TO RAMPANT MONEY LAUNDERING THROUGH CBI PAYMENTS?

If you are like me, you read the entire 43-page B of A Office of the Comptroller of the Currency (OCC) Consent Order (a/k/a Cease & Desist) closely, and found most of the regulator's requirements to be boilerplate, when it comes to compelling a bank with an ineffective AML program to conform to Banking Best Practices. There was one item, however, that may eventually cause some sea changes at B of A; the Transaction Monitoring Look-Back that appears at Article IX, on page 15-17.

While we understand that Bank staff have made it clear unofficially that they are not concerned with any exposure, regarding the correspondent accounts it maintains for the five East Caribbean states, Antigua, St. Kitts, Dominica, St. Lucia & Grenada, that have CBI passport sales programs, the Look-Back is certain to uncover a large number of transactions that are suspicious on their face, and where SARs should have been, but were not, filed of record.

The question is how far the third-party, designated as "Program Consultant," will take that information. Will there be a recommendation to restrict, or even close, some or all of those correspondent accounts servicing the Caribbean, where CBI payments in US Dollars, transit and are cleared? Given the bank's obvious reluctance to close those accounts, and lose that lucrative business, the question becomes whether the money laundering risks outweigh the rewards, and what the Program Consultant does in 2025.

ALLEGATIONS OF DRUG TRAFFICKING AGAINST ST. LUCIA MINISTER INVENTED BY JEALOUS POLITICAL RIVALS AND WITHOUT ANY BASIS IN FACT

Minister Richard Frederick

We have updated our investigation into the leaked classified U.S. State Department cable that alleged Saint Lucia Housing Minister RICHARD FREDERICK was connected to narcotics trafficking decades ago, and wish to bring our readers up to date on the issue.

(1) Our readers may recall that, back in 2021, we conducted our initial investigation into the charges, and found that the allegations had no merit. We published those conclusions on our blog of August 30, 2021. That article is still available: https://lnkd.in/e2DhSJzZ

(2) New allegations surfaced in late 2024, and we undertook to update our research last Fall.

(3) Our inquiries have confirmed that the drug trafficking label was placed on him by former Saint Lucia Prime Minister KENNY ANTHONY'S Labour Party, reportedly out of jealousy for his rising political status, and the likelihood of Frederick eventually being named the leader of the United Workers Party, during the administration of the incompetent STEPHENSON KING. Most observers consider Frederick to be a victim of Saint Lucia's corrupt politics.

(4) There's more; A U.S. law enforcement task force, led by two highly senior investigators with extensive Caribbean experience, investigated the allegations for just under two years, and were unable to find any evidence to corroborate Anthony's allegations.

Therefore, we continue to stand behind our 2021 article and its fact-based conclusions. Political corruption continues to thrive in Saint Lucia.

TD BANK NOW GUN-SHY, BUT IT'S TOO LITTLE AND TOO LATE

You've gotta love that story this week, by a longtime customer of TD BANK, who cam into a branch to withdraw $3000, which was to be used to pay for a big holiday family dinner. It took a full half hour for the bank to disburse the cash, ad the customers went through no less than three staff members, some of whom had the temerity of asking their customer for the purpoise of this "large" withdrawal.

Of course, there was no disclosure, and the bank staff finally dispensed that small amount of cash, but it shows you that bank staff must be feeling pressure after that billion dollar penalty for facilitating money laundering over a period of time. Here in South Florida, compliance officers knew there were flaws in the bank's AML program, after one of its vice presidents went to Federal Prison here a decade ago for assisting a Fort Lauderdale law firm perpetrate a huge Ponzi scheme.

Presently, the bank's involvement in operating a correspondent account for a corrupt Caribbean Citizenship by Investment (CBI/CIP) agency in Saint Lucia, where allegations of massive money laundering and fraud appear to have gone intentionally ignored, is just one more indicator that things were not right in the bank's AML/CFT compliance programs.

The question is;: will any of the bank's senior management go to prison for their egregious, intentional operations, which trumped profits over following banking best practices? Unfortunately, they are letting those criminals retire, from what I have seen. So much for deterrence.

ALERT FOR MONEY LAUNDERING FUGITIVE LIN PEN-WEN - INTERPOL RED NOTICE ISSUED

This individual, with links to organized crime, is wanted by the New Taipei District Court for his participation in an international money laundering scheme. Details can be found here. https://lnkd.in/e_SkFxnS

EFFECTIVE DUE DILIGENCE REQUIRES MUCH MORE THAN SIMPLY ACCESSING GOOGLE MAPS

The recent article directing readers to the use of Google Maps, to verify addresses, confirm physical locations of new account holders and their listed businesses, misses the mark. Compliance officers should, wherever possible, stock to official county, state and local information resources, as the Google information you intend to rely upon is most most likely stale, and therefore could be unreliable. Local government records, which are used for tax assessment and collection purposes are far more reliable, especially when double-checked by accessing public records databases of recorded documents. For example, Government real property records, used for tax purposes, are not only a rich source of very detailed, information, they may also give you historical data you cannot find without painstaking trolling of other resources. Become familiar with, and know precisely where all your government information online and hard copy sources are, and depend upon them first. They may be the only suspicious activity indicators you will find.

Remember, not all Google resources tell the inquirer how many months, or years, it has been since the information was posted. Money launderers often create credible cover stories about front companies by piggybacking upon formerly existing but no longer active legitimate businesses, addresses or locations, thinking that your perfunctory due diligence checks won't uncover the inconsistencies that a thorough examination, with dual confirmation of data might reveal. Ignore unofficial resources whenever possible, as those may just have settled upon republishing dated data, and are neither current nor accurate.