PARIS, Sept 3 (Reuters) – Criminal use of informal banking networks has become a global problem and is growing, the Financial Action Task Force said on Thursday, urging companies and governments to do more to combat professional money-laundering services.
Here’s what the global money laundering and terrorist financing watchdog FATF said in a report:
• Criminal misuse of non-bank settlement methods, including hawala and other similar service providers (HOSSPs) – which move payments through agents rather than regulated financial institutions – is “a widespread global phenomenon”.
• Illicit networks, once used mainly to launder the proceeds of cash-based crime such as drug trafficking and smuggling, now also process funds from fraud, cybercrime, terrorist financing, illegal gaming and gambling, as well as international organised crime.
• Professional service providers are increasingly involved in facilitating the schemes, including lawyers, accountants, auditors, consultants and real estate agents, FATF member states who contributed to the report said.
• Encrypted communications, fintech, anonymity-enhancing tools and the growing use of crypto and other new technology – have transformed informal money-transfer networks, and can make them faster, more opaque and more resilient.
• Underground banking and HOSSP-based money laundering have become increasingly professionalised, with some operating like sophisticated businesses.
(Reporting by Elizabeth Howcroft in Paris; editing by Philippa Fletcher)
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