Trade finance is emerging as a significant concern for AML/CTF enforcement authorities and compliance officers because of the complex nature of trade finance transactions and the difficulty in detecting and combating abuses within processes. With the evolution of AML/CTF controls globally, criminals exploit new ways to hide their dirty money. Trade-based money laundering (TBML) is one way to deceive regulatory authorities and move illicit funds cross-border without getting detected. Even in TBML, criminals adopt multiple schemes, including over or under-invoicing, multiple invoicing, short or over shipping, obfuscation and phantom shipping to achieve this aim.
The FATF recognises TBML as one of the three main methods by which criminal organisations and terrorist financiers move money by disguising its origin and integrating it into the formal economy. Hence, banks need to identify the risk areas in their trade finance activities and determine whether the controls in place are robust to mitigate AML/CTF risks.
The significant and global flow of funds and goods between international trade partners offers lucrative opportunities for criminally collusive importers and exporters to move illicit value between themselves, hiding dirty money in both false and legitimate trade transactions. Explore the anti-money laundering and broader financial crime risks and counter-terrorist financing risks that exist within international trade and finance.
This course will review trade-based money laundering typologies, including the misrepresentation of the price, quantity and quality of good and services, and include an update on risks such as dual-use goods and the latest techniques used to evade sanctions.
- Understanding Trade-based money laundering, Terrorist Financing and Sanctions, the FATF and Egmont Group framework.
- Trade-based money laundering in practice – an overview of the 5 days.
- What is Trade Finance? The Wolfsberg Group, ICC and BAFT Trade Finance Principles.
- The Risk-based approach to Trade-based money laundering.
- Evidence Based Risk Assessment.
- Clients, Documents, Shipping, Goods and Services and Red Flags.
- Common Trade-based money laundering techniques.
- Trade control – specific customer due diligence.
- The Three stages of TBML.
- The Three methods of TBML.
- TBML case studies and exercises in the practical application of the framework.
- Proliferation and dual-use goods
- Key points from the broader AML Framework and recap of the 5 days.
- Understand the key features of International Trade Finance products
- Discover a framework for navigating Trade-based money laundering risks
- Understand the key features of a Trade-based money laundering risk assessment
- Recognise Trade-based money laundering red flags
- Identify common policy, procedure, and control deficiencies from real TBML case studies
- Assess the AML, Sanctions and Terrorist Financing risk profile of proposed Trade Finance transactions
- Integrate Trade-based money laundering controls into an existing AML framework