This week I received a letter from a reader who was plainly unhappy with my coverage of money laundering in the Bolivarian Republic of Venezuela. He asked me to refrain from politics in my analysis articles. That is a fair question, and it deserves a straight answer. "From a Different Angle" is a comment & analysis feature that attempts to cover the emerging threats facing compliance officers and money laundering reporting officers. Our stated purpose is to aid our readers in risk assessment and management. There is not, and never will be, a political agenda, on these pages. We all live in a post- 9/11 world, with extreme, and even fatal, consequences for any institutions that fail to ascertain threats, and act accordingly. But on to a specific answer to his question.

This week, OFAC pronounced Pakistani drug-lord Shahbaz Khan a Specially Designated Narcotics Trafficking Kingpin (SDNTK). The members of his organisation, many of whom are now serving long prison sentences, utilised a cross-section of commercial front businesses in the Southwest Asia/Middle East region, as well as in Western Europe. A look at the countries where his money laundering operations were conducted, and the types of businesses he employed, offers a slice of money laundering trade-craft as practised in the Middle East. Of course, all the front companies were also designated by OFAC.

Whilst most observers understand the reasons behind the recent guilty plea of the NatWest Three, (a probable sentence of 37 months versus a possible 30 years) they may miss the case's most important lesson for UK professionals: any conduct that could constitute a financial crime impacting the United States may result in their extradition to that country, where Federal laws are heavily weighted in favour of the prosecution, and where the sentences are generally far longer than those handed down in the United Kingdom. Would you really like to be under an upraised blade for seventeen months, waiting for it to fall upon you? I think not.

The Office of Foreign Assets Control, OFAC, has announced that the enhanced civil penalties for IEPPA violations, promulgated on 16 October by President Bush, will be applied to most pending cases where a Final Penalty Notice has not yet been issued. This is bad news for all financial institutions whose penalties are still in various stages of processing. If your institution has a pending case, it is critical that you review the policy statement to ascertain exactly what your status is.

The Central Bank of Russia yesterday recalled the licenses of three Russian banks, all on the grounds that they violated anti-money laundering laws and regulations. Few details are available, but we present them below, together with all known trade names, legal names, and operating names of these institutions.

Venezuela's President Hugo Chavez Frias' Paris hotel room charge was US$50,000 per night during his recent overseas trip. Is that, by definition, such a clearly excessive expense that it serves as a warning to compliance officers to the effect that Chavez, or for that matter any Politically Exposed Person, may be improperly spending Venezuelan government funds? How much is too much?

I must confess that I was angered by the news last week, involving five individuals who laundered the proceeds of crime for a Cumbrian drugs organisation, and who have been sentenced to extremely short prison terms for their actions. Why was I upset? The short sentences meted out will certainly not only fail to deter others from engaging in that form of criminal conduct, these mild forms of punishment may even encourage people to commit money laundering.

With 15 December knocking hard upon the door, UK financial institutions whose clients number trust and company service providers would be well advised to query their clients in this industry to confirm that they have established the newly-required CIP/AML policies and procedures. Not sure exactly what specific businesses in this field need AML? Look below for some helpful hints.

For those readers who doubted the National Drug Intelligence Centre pronouncement earlier this month, that bulk cash smuggling is increasing from the US into Mexico, we offer the latest case. A 38-year old Mexican national was intercepted outbound at Nogales, Arizona this week. His actions were deemed suspicious by law enforcement, and his vehicle was searched, revealing US$484,500 in cash hidden under chocolate, in buckets and boxes. He was taken into custody, and the cash seized by US Customs & Border Protection agents.

There has been an increasing amount of interest of late in trade-based money laundering, and we thought it might be useful to discuss the more common variations, so that our readers can better recognise them on a real-time basis. Whilst we have covered the subject generally in the past, understanding the permutations and combinations employed by money launderers is a critical prerequisite to interdiction of trade-based money laundering operations.