Trade-based money laundering: organized crime, learning and international trade
| Published date | 28 March 2020 |
| Date | 28 March 2020 |
| DOI | https://doi.org/10.1108/JMLC-01-2020-0004 |
| Pages | 651-661 |
| Author | Todd Hataley |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial compliance/regulation,Financial crime |
Trade-based money laundering:
organized crime, learning and
international trade
Todd Hataley
Department of Justice and Community Development,
Sir Sandford Fleming College, Peterborough, Canada
Abstract
Purpose –The purpose of this paper is to examine the link between trade-based money laundering and
organized crime. Trade-based money laundering (TBML) has emerged as the newest and possibly most complex
method used by organized crime and white-collar crime groups for illegally laundering money in the
international financial system. Using legitimate global trade streams,criminal organizations are able to transfer
billions of dollars annuallybetween jurisdictions without having to adhere to state-level currency regulations.
Design/methodology/approach –Using a rational approachto understanding the behavior of criminal
organizations,it is argued that TBML will continue to grow as a preferredmethodology for laundering money
internationally. As criminal organizations continue to be displaced from the more traditional methods of
money laundering, they will look for and find TBML as a viable alternative for moving money between
differentjurisdictions.
Findings –As the methodologybecomes more developed, the skill set will transfer to an increasingnumber
of organizedcrime groups and be incorporated as a mainstream method for launderingand moving money.
Practical implications –To stay current with contemporary money laundering schemes, law
enforcement agencies willhave to train their investigators to spot, investigate and collect requisiteevidence
for successful prosecutionand disruption of TBML offences. Moreover, in the absence of a global regime for
sharing tradeand customs information, legislators and law enforcementagencies will have to consider how to
best expeditethe sharing of trade and customs information.
Originality/value –This is the only study toaddress TBML as an emerging money laundering technique
and the transfer of the skill between organized crime groups. It further details the skills that police
investigatorsneeds to develop to successfully combat TBML.
Keywords Money laundering, Organized crime, Trade-based money laundering,
Organized crime learning
Paper type Research paper
Introduction
In his 2016 book, John Cassara, widely considered to be the global expert on trade-based
money laundering (TBML), noted that TBML is “perhaps the largest and most
pervasive money-laundering methodology in the world! And in comparison to the
volume of international trade, successful enforcement efforts are practically nil”
(Cassara, 2016). TBML is a money laundering technique that uses the legitimate
international trade system to transfer value between legal jurisdictions. In terms of
money laundering techniques, TBML has emerged in the past 10-15 years as the most
complex method of money laundering used by organized crime and white-collar crime
groups. In terms of size, money laundering in general is a global problem, with
estimates from the International Monetary Fund (IMF) ranging from 2-5 per cent of the
Trade-based
money
laundering
651
Journalof Money Laundering
Control
Vol.23 No. 3, 2020
pp. 651-661
© Emerald Publishing Limited
1368-5201
DOI 10.1108/JMLC-01-2020-0004
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1368-5201.htm
To continue reading
Request your trial