2 million Suspicious Activity Reports (approximately) ÿled by banks annually FATF Country reports 2.1 trillion is the total annual criminal proceeds (3.6% Global GDP) 1.6 trillion available for laundering Less than 1% seized by authorities Money laundering global top 10 industry Arms dealers Financial institutions Cash intensive business Casinos & internet gambling Gatekeepers, lawyers, accountants, trustees & etc. High value goods dealers Agents & intermediaries Money services business Politically exposed persons Precious metals & stones dealers Private military ÿrms Real estate agents Sanctioned parties Product & channels risk MONEY LAUNDERING (ML) Source: United Nations Ofÿce on Drugs and Crime (UNODC). 2011 issued/2009 ÿgures. Figure excludes tax evasion. 3 STAGES OF MONEY LAUNDERING USD 690bn Counterfeit & Piracy USD 411bn Drug Trafÿcking USD 162bn Smuggling USD 140bn Illegal Gambling USD 150bn Human Trafÿcking Sources: United Nations Ofÿce on Drugs and Crime (UNODC), International Labour Organisation (ILO) and Havocscope. Total of USD2.1 trillion, of which USD870 billion by organised crime 41% TOP 5 MONEY LAUNDERING CRIMES Placement into the ÿnancial system of criminal monies Integration absorbed into the ÿnancial system appearing legitimate Layering moving money in the ÿnancial system to disguise its criminal origin 2 3 1 MAJOR ML CONTROLS Name screening Transaction monitoring Customer Due Diligence (CDD) Training & awareness Governance, culture & resources Investigations & disclosures Independent assurance Risk assessment INHERENT ML RISK CATEGORIES Examples Customer risk Private banking Foreign correspondent banking Non face-to-face customers Suspicious & unusual transactions Wash & pass through Suddenly active High risk third country Smurÿng Large in & out Suspicious Activity Report (SAR) True match Production order LARGEST CRIMINAL MARKETS Source: Havocscope 20% Others 20% EU 35% North America 5.5% Japan 6.5% Mexico 13% China UNODC 2.1 trillion ÿgures do not include fraud, tax evasion or corruption USD53 billion available to be laundered of which COCAINE TOTAL ANNUAL PROCEEDS USD 85bn TOP 5 49% moved internationally Transaction risk Geographies risk High risk countries including sanctioned countries Behaviour risk BE DILIGENT . BE CURIOUS. BE VIGILANT . Figures used from various public sources 2011/14