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CONFESSIONS OF A
MONEY LAUNDERER by Kenneth Rijock
MONEY LAUNDERER by Kenneth Rijock
Financial Crime Consultant, for World-Check
Confessions of a Money Launderer - Part 87
2 March 2009
I started my new job as a compliance officer at the investment company, knowing that it was a global business, with clients around the world. Arriving at work every day before 7a.m., I was able to speak to clients and sales staff located in the Middle East, as well as in Eastern Europe. The offer was for me to spend four hours each day in the office, but it soon became apparent that I needed to be there all day, every day, just to keep up with the volume of new clients. I got the tough ones, the Colombians, the high net-worth investors, the corporations, the funds, even foreign foundations, elusive investors from faraway places, all the problem cases. Was it challenging? You bet, but by now, you know that I wouldn't have it any other way.
Some of our readers have heard me tell tales of my time in compliance, but for those who have not yet seen me lecture in person, I will relate a few of the more colourful ones. if I have not yet been to your country, please be patient, as I intend to appear at them all.
Here's a sampler of a couple of the hard ones:
Next week; more war stories from the compliance front.
Here's a sampler of a couple of the hard ones:
- A client who was a financial adviser in Montevideo was investing $500,000, purportedly all his own money. He was an Anglo-Uruguayan, with his own firm, My due diligence failed to show any Internet footprint, which is a red flag, because every successful professional shows up on the world wide web somewhere; either in newspaper and magazine articles, business news, professional news, even social, charitable or recreational events. The client had no entries, meaning he was either an anti-social recluse, or linked to a darker world. I then ramped up enhanced due diligence, which includes a search of the archives of major newspapers, all the way back to the dawn of the commercial Internet in 1995. An article in a Sydney newspaper returned a positive result. It seemed that one of Mexico's most wanted narco-fugitives had been apprehended in Australia, wanted to bond out, and his attorney offered a multi-million dollar residence in Sydney as collateral, to ensure that his client would appear in court. The owner of this mega-mansion? My Montevideo investor. How someone who lives and works in Uruguay, and visits London regularly, comes to have assets in Australia is one thing. Why they would put up this property for a known major narcotics trafficker is another. I therefore declined to accept the client, not specifying the grounds. Let me warn you that money launderers, and their clients, often take offence when you turn them away. They may sue the bank, or you, or threaten you physically. Thus, never tell them the reason for your actions. Give them some legalese, such as "your application failed to meet the requirements of our compliance policies & procedures manual," or some other similar gobbledygook. In this case, the client called up our compliance office, seeking the reason why we would not accept his business. I took the call, and I am, of course, not shy. Knowing that I had a money launderer, I advised him that my policy was to decline any new business when the client was a close associate of an organised crime figure. He did not argue the point, but asked me the same question that I would have asked had it been me as the launderer that day. He said "Can I get my money back.?" Since I knew that loss of money might be grounds for his assassination by the client, and since our firm was not involved in law enforcement activities, I, of course, agreed. He would live to move dirty money another day, but not through me.
- A "dot-com" Internet millionaire, who got out before the crash, having very good credentials, wanted to invest a large amount of money. He resided in Utah, and had extensive real estate holdings there. No negative results from my due diligence enquiries, but I always look at a high net-worth client's advisers. In this case, his attorney was located in Las Vegas. In my experience, I have found that wealthy clients like to be in close proximity to their primary attorneys, in case they need them on short notice. Given that rule, I started checking out the lawyer. Lo and behold, he had been fighting off a money laundering indictment in Memphis for some time. he was also the author of some articles on offshore financial centres. Based upon that finding, I declined to accept the client. Remember, though, the old money launderers' axiom: if you cannot gain access through the front door, try the back door, the side door, even the trap door. The lawyer's son was later identified by me as having formed a shell company in Idaho, and attempting to invest the same funds through that vehicle. Do not ever assume that, once you have defeated a money launderer, he or she will not come back in disguise, and try, try again.
Next week; more war stories from the compliance front.
The facts and opinions stated in this article are those of the author and not those of World-Check. World-Check does not warrant the accuracy of any facts and opinions stated in this article, does not endorse them, and accepts no responsibility for them.
Read more in this exciting series
11 April 2010
8 March 2010
8 February 2010
24 January 2010
6 December 2009
27 September 2009
9 August 2009
3 August 2009
30 March 2009
9 March 2009
2 March 2009
22 February 2009
18 February 2009
26 January 2009
18 January 2009
11 January 2009
5 January 2009
29 November 2008
24 November 2008
17 November 2008
8 November 2008
3 November 2008
27 October 2008
20 October 2008
13 October 2008
4 October 2008
28 September 2008
20 September 2008
15 September 2008
15 June 2008
8 June 2008
1 June 2008
26 May 2008
19 May 2008
12 May 2008
4 May 2008
27 April 2008
20 April 2008
13 April 2008
31 March 2008
18 March 2008
4 March 2008
25 February 2008
16 February 2008
10 February 2008
3 February 2008
27 January 2008
20 January 2008
14 January 2008
6 January 2008
16 December 2007
9 December 2007
1 December 2007
25 November 2007
18 November 2007
11 November 2007
3 November 2007
27 October 2007
21 October 2007
14 October 2007
7 October 2007
1 October 2007
23 September 2007
16 September 2007
3 June 2007
27 May 2007
21 May 2007
6 May 2007
30 April 2007
22 April 2007
15 April 2007
8 April 2007
2 April 2007
24 March 2007
19 March 2007
12 March 2007
5 March 2007
25 February 2007
19 February 2007
12 February 2007
4 February 2007
28 January 2007
22 January 2007
15 January 2007
7 January 2007
2 January 2007
16 December 2006
10 December 2006
3 December 2006
27 November 2006
19 November 2006
11 November 2006
5 November 2006
29 October 2006
22 October 2006
16 October 2006
9 October 2006
2 October 2006
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