Typologies of Money Laundering & Terrorist Financing through Trade and Money Services Business (MSB) in United Arab Emirates.

Altaf Shaikh

Money laundering is an evolving activity, driven by the need for criminals to legitimize the proceeds of crime. In recent years, global and regional regulators have implemented stringent measures pertaining to Anti-Money Laundering & Terrorist Financing, which has made it difficult to launder money through the traditional channels. Due to the same, money launderers are using more sophisticated methods like TBML especially since it is very difficult to set red flags for detection of illicit funds. This can be supported by a report from International Narcotics Control Strategy Report (INCSR) of 2017 which states billions of dollars are laundered annually by way of Trade-Based Money Laundering (TBML).

Anti-money laundering and countering the financing of terrorism (“AML/CFT”) controls for trade finance and Money Service Business (MSB) as areas where there could be scope for improvement. Robust controls in these areas enable banks to better prevent and detect the risks associated with trade based money laundering, proliferation financing and other sanctions compliance related issues. This paper aims to provide guidance on the AML/CFT controls in trade finance and MSB, assist them in their benchmarking against industry norms and in the implementation of sound risk management practices, and identification of control gaps.

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