| Evelyn Millen, a former IRS agent, was sentenced to a 30-month jail term for money laundering. Millen’s dirty money dealings were discovered when she bought a $65,000 BMW in her name, using drug-trafficking proceeds from her niece’s boyfriend.
Money laundering aims to disguise the source or ownership of illegally-obtained assets. Unlike terrorist financing transactions, the sums involved are generally large. Purchases of large-ticket items, such as cars, jewelry and real estate are the easiest conduits for making dirty money look legitimate. They involve fewer additional parties (as opposed to smurfing schemes), and can be completed relatively quickly and with fewer individual transactions. Companies involved in businesses that are attractive money laundering targets need to make sure that they are always up-to-speed on the latest Know Your Customer (KYC) regulations and the technologies that facilitate compliance.
Aware that people use large cash purchases to cover money from suspicious sources, the Financial Action Task Force (FATF) and USA PATRIOT Act designate spending thresholds for certain businesses such as casinos, real estate dealers and dealers of precious stones. The FATF, for example, says that businesses receiving more than 15,000 Euros in a single transaction for precious stones should report the action for AML/terrorist financing analysis while the U.S. level for such scrutiny begins when the amount exceeds $10,000.
Given this attention to high dollar purchases, it is somewhat surprising that as an ex-IRS Agent Millen couldn’t structure her acquisitions in such a way to avoid the attention of her former employer. It’s tough to clean up with dirty money.
|
