China FATF lead
vehicles, jewellery and artwork- to launder proceeds from IWT at the integration stage. This shows the important role those certain non- financial sectors ( real estate agents, lawyers and precious metal and stones dealers) can play in detecting suspicious funds linked to IWT. The investigators supported themselves by describing how two South African and Indonesian wildlife syndicates laundered their proceeds through luxury property and vehicles.
The findings show that one US investigation revealed that in 2015- 2016, an IWT syndicate used “fei chen’” ( flying money) networks in China to transfer value ( funds) between the syndicate leader, based in Asia, and a corresponding ethnic Chinese associate in Uganda. Specifically, the IWT syndicate delivered RMB to an executive in China. In turn, an ethnic Chinese associate of the subject in China, who resides in Uganda, delivered a corresponding amount in US Dollars to the wildlife trafficker in Uganda. The funds were used to purchase ivory and rhino horn for shipment to the IWT syndicate in Asia.
Simi larly, in another recent US investigation, an IWT syndicate required that monies for the purchase of illicit wildlife from Africa be delivered to bank accounts in China before delivering the illicit wildlife in another country in Asia. The customer purchasing the illicit African wildlife in Asia subsequently deposited USD with an ethnic Chinese money exchange broker in Thailand. For a small fee, this money broker in Thailand immediately contacted an associate in China who, in turn, delivered a corresponding amount in RMB into bank accounts in China, all within hours.
Upon confirmation that all of the funds were deposited into Chinese accounts, the illicit wildlife was delivered to the customer in another country in Asia. In both cases, the operators of the money exchange businesses relied on an informal MVTS network in which a broker in country “A” transfers funds to a member of their MVTS network in another country; in turn, a corresponding amount in the local currency or in USD is delivered by the MVTS to the wildlife trafficker. In these same US investigations, wildlife traffickers also used multiple small MVTS transactions to move funds to purchase ivory, rhino horn, and/ or pangolin scales collected and then shipped to customers in Asia.
The finds state similarly, in a separate case carried out by the Environmental Investigation Agency ( EIA), a nongovernmental organisation, a Malaysian national specialising in transporting ivory and pangolin scales from Africa to Vietnam described to investigators how he received payments from his customers into a Malaysian bank account through a money exchange service based in a third country, which he referred to as ‘ underground banking’. He claimed that the bank account details of the underground bank are valid for one day only, and that once the funds are deposited in the third country, the money is transferred to his bank account in Malaysia within two hours.