Private sector can help stop money laundering

Financial institutions, dealers, auction houses used Large USD wired between wildlife farms and firms

The private sector has an important role in detecting suspicious activity, and reducing opportunities for wildlife traffickers to misuse their financial or non- financial services to launder their gains, argues the Financial Action Task Force ( FATF).

They argue that large cash or other deposits, wire transfers, multiple cash deposits and withdrawals, and, or unexplained wealth from government officials working in forestry agencies, wildlife management authorities, zoo and wildlife park employees, or CITES Management Authorities ( CMAs) can be detected if the private sector comes on board.

FATF is an independent inter- governmental body that develops and promotes policies to protect the global financial system against money laundering, terrorist financing and the financing of proliferation of weapons of mass destruction. The FATF recommendations are recognised as the global anti- money laundering ( AML) and counter- terrorist financing ( CFT) standard.

In their latest appeal to the world, FATF requests all to act before it is too late arguing that with the world becoming increasingly interconnected and online wildlife markets expanding, countries will need to work together with the private sector and civil society to combat this threat.

In its latest findings, FATF says wildlife traffickers use services provided by financial institutions, including banks, payment institutions, as well as non- financial institutions, such as dealers in high- value giving examples of art, antiquities, auction houses, and other collectibles to move and hide their illicit proceeds.

Further those wildlife traffickers are using “established” methods to launder their proceeds, including using placement and layering of funds through the formal financial sector, purchasing real estate and luxury goods and using money value transfer systems. They are using front companies, often linked to the import- export sector but also the legal wildlife trade, to co- mingle licit and illicit proceeds. Increasingly, they are also using online marketplaces and mobile and social media based payments methods. FATF says by understanding their financial risks and exposure to the illegal wildlife trade, the private sector can take measures to stop wildlife traffickers from misusing their services, and by understanding the money laundering threats posed by wildlife traffickers. The private sector can also take informed steps to detect and report suspicious financial activities to the public sector. “This will help trigger investigations or support ongoing criminal investigations and identify the wider network of criminal syndicate leaders and financiers involved in the illegal”. In its latest report titled Money Laundering and the Illegal Wildlife Trade it says financial and non- financial institutions should identify, assess, and take effective action to address their money laundering and terrorist financing risks. They should report behaviour and, or transactions with suspected links to illegal wildlife trade to the country’s financial intelligence unit.

However , they advise reporting entities should carry out customer due diligence when establishing business relationships, when carrying out transactions in certain circumstances, when they have suspicion of illegal wildlife trade activity, and when they have doubts about previously obtained customer identification data.

Identifying and disrupting financial flows linked to illegal wildlife trade requires collaboration between the public and private sector, particularly with different stakeholders that do not usually work together on money laundering investigations. Public- private partnerships are a valuable solution to bring relevant environmental and financial experts together.