Congres﻿sional Testi﻿mony on Trade-Based Money Laundering

Congressional Testimony on Trade-Based Money Laundering

2/3/2016

On February 3, I was honored to testify before the Task Force to Investigate Terrorism Financing of the House Financial Services Committee. The hearing was on trade-based money laundering. A video of the hearing is available here:
http://financialservices.house.gov/calendar/eventsingle.aspx?EventID=400192

The hearing went well.

2 Comments

Sam link

2/10/2016 10:33:50 am

Hi John,

The news post (noted above) on your testimony prompted me to write up a brief summary on my corporate-internal group AML site, and I purchased your new book. When I have a chance I'll view the video of the testimony.

I do have a question, though maybe it will be answered at some point in the book -- items such as buckets, toilet paper, and bulldozers at ludicrous prices were cited as some of the examples of invoice fraud. While these would be pretty detectable using a mean/std dev. analysis, if the items were something like perfume wouldn't the natural variation in price make detection impossible? How could one detect either false markups/downs when you're selling smelly water?

John link

2/12/2016 08:33:04 am

Thanks for getting the book! Please give me your feedback. Re crazy priced items like $972 buckets, of course, some of this can be statistical outliers. But the point I am trying to make is that this kind of thing happens all the time. Red-flags should be waving and the import/export examined. It's not happening because of the very volume of trade. Re items like perfumes, customs has "import specialists" and probably on occasion analyzes product. But I suspect (and I have no data to back it up) that this kind of product invites fraud. Certainly counterfeit product is introduced into commerce. It's like gold; is it 14 ct or 12 ct or 18 ct? That little difference in quality transfers a lot of value.