Follow the money: Explore money laundering and human trafficking links Loop Jamaica

Black Immigrant Daily News

Local Financial Service Providers (FSP) are being urged to train their staff to identify the signs of human trafficking due to its link with money laundering.

Vice president of the International Compliance Association, Pekka Dare in making his presentation on Human Trafficking and Money Laundering at the recently held Anti-Money Laundering/Counter Financing of Terrorism Conference hosted last month by the Jamaica Institute of Financial Services (JIFS) and the Jamaica Bankers Association (JBA), said FSPs have a “massive role to play” in combating human trafficking.

The umbilical ties between the two have resulted in billions of illicit funds flowing through the Caribbean, Dare said pointing to data from the United Nations and US-based Global Financial Integrity – which researches corruption and illicit financial flows.

“The scale of this problem is global and it is huge,” he said.

According to Dare, research also indicates that human traffickers exploit the fisheries industry within the Caribbean.

“It [the research] talked about US$10 billion turnover across the Caribbean with between 80,000 to 100,000 persons being smuggled through the Caribbean annually,” he told the gathering of financial service providers.

With the growth of human trafficking globally, he urged the FSPs to “follow the money” and improve their systems for tracking illicit transactions.

“There is a lot of focus on following the money…this activity wouldn’t continue without the organised criminal networks making huge amounts of money…if we can work together as financial institutions, Financial Intelligence Units (FIU) and regulators to try and strangle and check where the money is going, we can stop these networks,” he said.

He encouraged FSPs to utilise the resources of firms such as the United Kingdom-based charity Stop the Traffic to bolster their watch of suspicious financial transactions.

A financial inclusive economy will also go a long way toward stemming human trafficking, he said.

“We need to keep promoting financial inclusion because the grey economy thrives [with funding from human trafficking]. This is where a lot of this money moves in alternative remittance systems such as Hawala [an alternative remittance channel that exists outside of traditional banking systems],” he said.

“Often migrants are not banked and they will use the informal economy to move money…if we can encourage these people to use the regulated or traditional economy and financial services, we have more chances of protecting them and detecting this activity,” he said.

He suggested that FPS look for suspicious transactions such as “money coming in and out quickly; frequent transfers to several parties abroad and strange flows of money in short time periods.”

Spreading financial transactions across multiple banks; buying high-value goods and real estate; transfers of cross-border funds and an unwillingness to declare ‘source of funds’ are also tell-tale signs of human trafficking, Dare said.

“Train and educate your staff on the red flags of human trafficking that they need to look for…there is a massive link to Know Your Customer (KYC) and Customer Due Diligence (CDD),” he said.

For Business and Financial Consultant of Modern Slavery and Human Trafficking of Stop the Traffic, Christina Smith, modern slavery and human trafficking is the third most profitable criminal activity in the world behind counterfeit goods and drug trafficking.

“It is always the one that gets forgotten but it is huge in terms of profit and this is why following that money is so crucial,” she told the conference.

For example, “One of our partners in Houston found that traffickers were exploiting women in Houston and in 2019 alone, they made US$ 3 billion in one year just for trafficking women.”

By Tameka Gordon

NewsAmericasNow.com