Newswire:
World-Check releases White Paper on Piracy
|
World-Check releases FCPA White Paper
|
World-Check expert seminars attract 600 delegates in 13 cities worldwide
|
World-Check renews partnership with the UK's Child Exploitation and Online Protection Centre
|
More Newswires...
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 94
24 January 2010
The recent events in Haiti take me back to my experiences in that troubled country, especially after having seen that the place where I conducted lectures, and always stayed, the Hotel Montana, home to the United Nations staff, was destroyed, with victims still trapped and lifeless, inside. I have already written about that nation's new vulnerability to money laundering and financial crime. (See "Money Laundering opportunities Abound in Haiti Crisis," World-Check 16 January, 2010*) because all my time spent in Haiti was not, strangely enough, as a money launderer, but as a compliance and financial crime consultant, all before 9/11.
How did it begin ?
- One day, I received a call from a Washington DC consultant, whom I knew from a mutual friend in law enforcement. One of Haiti's largest banks was being threatened with the termination of its primary correspondent banking relationship, held with a major American financial institution. the US bank was concerned about money laundering risks in Haiti, and wanted assurances that the bank, located in Port-au-Prince, was engaging in banking best practices in AML.
- My role was to review the bank's anti-money laundering policies and procedures, customer identification programme, and to spot-check customer accounts, all for the purpose of preparing a report, to be presented to the US bank, to convince it that termination of the correspondent relationship, for perceived AML deficiencies, was not necessary. Remember, this was ten years ago, and Haiti at that time had no anti-money laundering laws whatsoever.
- My secondary task was to conduct a full-day AML programme, sponsored by the bank, but open to the business and financial community. If you understand me by now, you know that this was purely a labour of love, for i was able to cover the history of money laundering, money laundering strategies and techniques, due diligence enquires, case studies, and more kin the all-day session. It was well attended, but it was clear that many of the bankers and businessmen present were just getting their tickets punched. Allegations that Haiti is not only the most corrupt country in the Western Hemisphere, but one with unchecked money laundering, are unfortunately, true, from what i could see an an objective observer with personal money laundering experience.
- I have knocked around the Caribbean for decades, first as a lawyer representing US companies operating there, and then for a decade as a money laundering in the "banking republics," but I was not prepared for the utter poverty, massive unemployment, and economic inequality that I saw whilst working in Haiti. Individuals would run up your car at a stop, trying to sell the driver an old windscreen wiper, whilst Colombians, obviously drug traffickers, sped by in their $100,000 automobiles, en route to luxury homes in gated communities. Upper-class Haitians, who are a microscopic segment of the population, are conspicuously enjoying luxuries, whilst the rest of the population survives on $2.00 a day, supported mainly by their Miami relatives. I am wondering now whether the upper class, many of whom openly maintain mistresses in Miami, survived the earthquake. Were they in Paris that week, I wonder?
- The bank, located in downtown Port-au-Prince, had a level of security only necessary in a place where crime is out of control, law enforcement minimal, and corruption rampant, and on a level that has to be seen to be believed. It seemed that there was a guard, toting a shotgun, every ten meters in the bank; This is not an exaggeration. I frankly felt safer in Vietnam during my service there in the war, than i did in Haiti.
- After conducting my AML audit on site, during which time I learnt that, whilst the procedures were in place, Source of Funds verification, and close examination of customer lines of business needed improvement, I prepared my report, which I delivered personally to the US bank's Miami officer in charge of the correspondent relationship,
- I next reached out to a friend in law enforcement, who supplied me with three examples of money laundering operations that had sailed right through the bank, unhindered. At that point, I transmitted them to the bank president, who continued to insist that their procedures were being followed, and that the three matters that I has in hand were minor exceptions, and stubbornly stated that the bank was " clean, very clean." Obviously, not true.
The US bank that was examining the correspondent risk level did eventually terminate the relationship, forcing the Haitian bank to go elsewhere with its US business.
Just to give you the flavour of the level of corruption in Haiti, I was thereafter engaged to assist a US AML software company interested in placing its programme with the Ministry of Finance, to be installed in the five major Haitian banks, all of whom communicated with each other via what was probably the only high-speed link in the country at that time.
- When we got on the plane at MIA, we found that, sitting next to us, was the local IT professional who serviced the Ministry of Finance. Someone must have had good intelligence on our activities, and enough pull with the airline to get that seat. He promptly advised us that he was the mandatory local partner.
- The local IT representative insinuated himself into the relationship forthwith, and his "joint venture" concept was a thinly disguised local partner, though his company had a Florida, as well as, Port-au-Prince facility. Just who was going to be the recipient of the portion of the fee which was to go to the local partner.
- I never learnt who in the government was really behind the "partner,' for his outrageous demands to greatly increase the price of the software placed it outside the government budget, for the project was never approved, Whether it was due to the turnover of ministers, or other factors, i never knew. All i knew was that the project was a colossal waste of time for all. No AML software made it into the financial system, due to corruption out of control.
My hope is that the natural disaster visited upon Haiti will result in a house-cleaning, and that the endemic money laundering that has existed in the country will be stopped by UN administrators. Only time will tell, but rebuilding of the financial structure should include AML/CFT reform. I don't want to hear any more stories of ships coming in from
Miami, loaded with drug dollars, destined for Colombian cartels, unloading in the port.
____________________________________________________________________________________________________
http://www.world-check.com/articles/2010/01/16/money-laundering-opportunities-abound-haiti-crisis/
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
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
Print Confession
Email Confession
More Confessions
Subscribe to Newsletter
PRODUCT INFORMATION
COMPLIANCE OVERVIEW
NEWSWIRE
World-Check releases White Paper on Piracy
World-Check releases 'Piracy in the Horn of Africa' a White Paper by Rear Admiral Chris Parry CBE. With antecedents that reach back to classical times, piracy has sprung up and thrived in vari...more
World-Check releases White Paper on the Forei...
Titled “The FCPA and why it matters” this paper provides insight for multinational organisations into the US Foreign Corrupt Practices Act (FCPA) and highlights the basis for a sound compl...more
World-Check expert seminars attract 600 deleg...
Since July 2009 World-Check, the leading provider of end-to-end risk management services, has presented expert seminars in Monaco, Frankfurt, Madrid, Lisbon, Stockholm, Helsinki, Oslo, Copenhagen, M...more
World-Check renews partnership with the UK's ...
Since November 2008, the World-Check database has been used in over 130 enquiries by the CEOP's financial investigators to ascertian background intelligence on child abuse cases. To read the full ...more
Jersey convicted narcotics trafficker profile...
Read the full press release to see why it makes sense to use the World-Check se...more
Make this my homepage
Bookmark
