1 Black Market Peso Exchange 1 Peso Broker Drugs US Dollars Pesos US banking system Canadian grain exporter Grain Columbian grain importer Pesos Copyright Lessons Learned Ltd 2016 2 ID: 589184
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Slide1
Copyright Lessons Learned Ltd 2016
1
Black Market Peso Exchange (1)
Peso
Broker
Drugs
US Dollars
Pesos
US banking
system
Canadian
grain exporter
Grain
Columbian
grain importer
PesosSlide2
Copyright Lessons Learned Ltd 2016
2
Black Market Peso Exchange (2)
Key facts
Origins:
sale of illegal drugs from Colombia in US and subsequent ‘exchange’ method used to repatriate profitsScope: typology which is now used widely in many countries to repatriate the proceeds of crimeBenefits to colluding importer: broker of the exchange generally offers a better exchange rate than local banks
Money launderers’ perspectiveNo shortage of exporters/importers willing to collude because of favourable exchange ratePrices and quantities of goods can be correctly reported to customs agencies and value still transferred across bordersMajority of risk is cascaded down from the principals to their agents (brokers and third parties)Slide3
Copyright Lessons Learned Ltd 2016
3
Black Market Peso Exchange (3)
Possible ‘red flags’
Any ‘money brokering’ business that deals in cash exchanges of currencies commonly associated with this type of exchange system
Frequent cash deposits just below the local cash transaction reporting threshold (where one exists)Regular financial relationship with import/export business where such relationship does not fit what is known about the customerRevenue streams not make sense, given what is known about the entities involved and their normal business activities