The Corporate Connection

How drug money is finding its way to the bottom line.

4. The cambista then instructs his contacts in the United States– known to law enforcement officials as “smurfs”–to deposit the money in banks in amounts less than $10,000, to avoid triggering suspicious- activity-reporting requirements.

5. Colombian importers place orders for U.S. goods, but make their payments in pesos to the cambista. The broker instructs his smurfs to pay for the goods with the dollars in their bank accounts, typically via money orders or wire transfers, and often with multiple payments.

6. The goods are typically smuggled into Colombia via transshipment points such as Panama, Aruba, or even Europe or Asia, then sold in contraband markets in Colombia known as “San Andrecitos.” –T.R.

AN OUNCE OF PREVENTION

Here are suggestions from company executives and law enforcement officials about how to guard against the Black Market Peso Exchange and other money-laundering schemes:

RED FLAGS. Beware of commercial customers that have no interest in price discounts, or that lack normal business infrastructure and credit history. Beware of individual consumers making large purchases that are inconsistent with personal use (three washing machines, for example).

PAYMENT RESTRICTIONS. Prohibit cash or wire-transfer payments from third parties, or payments through travelers’ checks, foreign bank drafts, or money orders not drawn on the account of the entity that made the purchase. Payments in cash or money orders should raise red flags.

KNOW-YOUR-CUSTOMER RULES. Investigate and document the legitimacy of customers, particularly commercial resellers and distributors.

DISTRIBUTOR CONTRACTS. Prohibit distributors from selling goods for export, and audit and enforce these contract provisions (particularly in high-risk regions like South Florida).

EMPLOYEE TRAINING AND REPORTING. Explain to employees how money-laundering works, and provide them with an ombudsman channel to report suspicious transactions.

CUSTOMER TRAINING. Educate customers (such as retail dealers) on your payment restrictions and know-your-customer policies, and provide them with information to help them comply. –T.R.

Discuss

Your email address will not be published. Required fields are marked *