February 14, 2017 Articles

Dawn of a New Age: Trade-Based Money Laundering Enforcement

Currency is rarely used nowadays—rather, a significant portion now involves the international trade of goods and services

by William Ezzell and Scott A. Stringer

When people hear the term "money laundering," many envision substantial amounts of illicitly accumulated currency, funneled through elaborate schemes with multiple financial institutions and anonymous corporations. Recently however, the U.S. Department of the Treasury identified the rise of a specific type of money laundering within the global trade market described as trade-based money laundering (TBML). TBML schemes are one of the, if not the most, challenging forms of money laundering to investigate. In fact, some experts estimate TBML as the largest form of money laundering in the United States, with hundreds of billions of dollars funneled through financial and nonfinancial entities on an annual basis. See U.S. S. Caucus on Int'l Narcotics Control, 113th Cong., The Buck Stops Here: Improving U.S. Anti–Money Laundering Practices (2013).

With the magnitude of TBML, federal enforcement agencies have taken notice and accelerated investigations against financial and nonfinancial companies in the fight against this backdoor entry into money laundering.

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