The regulation of non‐vessel‐operating common carriers (NVOCC) and customs brokers. Loopholes big enough to fit container ships

DOIhttps://doi.org/10.1108/13590790710721837
Pages84-93
Date09 January 2007
Published date09 January 2007
AuthorNikos Passas,Kimberly Jones
Subject MatterAccounting & finance
The regulation of
non-vessel-operating common
carriers (NVOCC) and customs
brokers
Loopholes big enough to fit container ships
Nikos Passas and Kimberly Jones
Northeastern University, Cambridge, Massachusetts, USA
Abstract
Purpose – The aim of this paper is to contribute to one’s understanding of vulnerabilities for abuse in
the realm of trade and commerce, and to appreciate how inattention to this issue undermines all other
financial controls.
Design/methodology/approach – The authors review the US rules and regulations regarding
non-vessel-operating common carriers and Customs brokers pointing out ways in which the current
regulatory framework can be violated.
Findings – It was found that the potential for the commission of serious crime through import/export
activities is high and requires urgent attention, without which all AML/CFT and anti-corruption
efforts can be rendered ineffective.
Research limitations/implications – More data and analysis of trade transparency and national
rules as well as cases highlighting concretely how these are being infringed is indispensable for
planning and implementation of trade transparency initiatives.
Practical implications – As trade transparency units or similar projects are likely to emerge,
strategic thinking, coordination of efforts and maximization of synergies for improved governance and
crime control are imperative. Failure to do so will allow serious misconduct and security risks to
remain high.
Originality/value – AML/CFT and anti-corruption practitioners, donor organizations and technical
assistance providers ought to be familiar with the significance of weak capacities to trace and monitor
trade transactions and how to connect this issue with wider governance and crime control
policies/measures.
Keywords Crimes, Terrorism,Money laundering, Governance
Paper type Research paper
Introduction
Risk-based approaches to money laundering, terrorist finance, corruption and other
serious crimes are being discussed and implemented in several countries and at the
international level. Financial controls are indeed essential tools in the hands of those
seeking to prevent, investigate and prosecute any of these crimes. Yet, most emphasis
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1359-0790.htm
Research on which this paper is based was sponsored by a US National Institute of Justicegrant for
a study of “Terrorist Finance and the Nexus with Transnational Organized Crime: Commodities
Trade and the Social Organization of al Qaeda Groups,” Grant No. 2003-DT-CX-0001. The authors
wish to thank Don DeKieffer and Lou Bock for their very helpful comments and feedbacks.
JFC
14,1
84
Journal of Financial Crime
Vol. 14 No. 1, 2007
pp. 84-93
qEmerald Group Publishing Limited
1359-0790
DOI 10.1108/13590790710721837

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