What is Trade Based Money Laundering?
Trade based money laundering (TBML) is a sophisticated method used by criminals to disguise the origins of illicit funds through legitimate trade transactions. In TBML schemes, criminals exploit the complexities of international trade by manipulating invoices, customs documents, and other trade-related documents to move money across borders without detection.
Trade Based Money Laundering Techniques
Following are some of the well-known trade-based money laundering techniques :
- Over- and Under-Invoicing: Criminals may manipulate the prices of goods or services on invoices to overstate or understate their value. Over-invoicing inflates the cost of imports or exports, allowing criminals to move money offshore, while under-invoicing reduces the apparent value of goods, allowing them to evade taxes or duties.
- Falsified Trade Documents: Criminals may create or alter trade documents, such as bills of lading, shipping invoices, or customs declarations, to misrepresent the nature, quantity, or value of goods being traded. These falsified documents help conceal the true origins and destinations of illicit funds.
- Phantom Shipments: In phantom shipment schemes, no goods are actually traded, but fake invoices and other documents are created to facilitate the movement of funds. Criminals may use shell companies or fictitious trade intermediaries to obscure the flow of money.
- Round-Trip Transactions: In round-trip transactions, funds are transferred between two entities through a series of complex trades, often involving multiple jurisdictions and financial institutions. These transactions create the appearance of legitimate trade activity while effectively laundering illicit funds.
Trade based money laundering poses significant challenges for law enforcement and financial institutions due to the volume and complexity of international trade transactions. Detecting TBML requires sophisticated monitoring and analysis of trade data, as well as collaboration between government agencies, financial institutions, and international organizations.
Certified Trade-Based Money Laundering Expert
Trade finance is a highly specialized area of knowledge. Compliance officers dealing with TBML often find it challenging to deal with cross-border transactions, complex documentation, products and pricing-related issues. Without the right amount of knowledge, AML compliance teams will not be able to create guidelines and put processes in place to effectively monitor TBML within the organisation.
Trade Based Money Laundering takes advantage of the complexity of trade systems. International trade involves multiple parties and jurisdictions. Performing AML checks and customer due diligence becomes a difficult process.
Certified TBML Expert is an important tool for financial institutions to combat TBML. This course is designed on the basis of the book "
From registration to certification, the process can be completed online. It is a video learning course, which is supported by real-life problem-solving assignments. This program is also helpful for law enforcement agencies and their staff.
Trade-based Money Laundering also known as TBML is the newest form of Money Laundering and is known to cause a loss of billions of dollars annually throughout the world. Many trade finance professionals from the private sector banks benefit from this program.
This TBML certification program details the techniques used by money launderers to manipulate trade transactions and launder tainted funds from various geographical locations. Common forms of TBML include over- and under-invoicing goods and services, over-and under-shipments of goods etc.
The Financial Action Task Force (FATF) guides TBML-related issues and sites many examples. Several shell companies purchase electronic goods with funds derived from criminal activities — and then sell the goods to buyers in high-risk countries with minimum due diligence. The proceeds of crime are then directed back to the shell companies.
The emphasis of this Certification on TBML is early warning signs, which are explained in-depth to help the certified TBML professionals detect suspicious activities. A special emphasis is laid on the challenges in the investigation of this crime. The role of banks and other intermediaries is also highlighted in the detection of red flags of trade-based money laundering.
The only way of integrating tainted money into the formal economy is by disguising the origin of the funds. The modus operandi ranges from creating fictitious documentation of legitimate trade transactions to moving illicit goods. These tactics of converting tainted money into a clean economy are complex and it is extremely challenging to detect the red flags of these activities.
Seeing the exponential growth of trade in the global scenario, trade-based money laundering poses an immediate threat as a significant channel of criminal activity and exposes businesses across countries to the risk and vulnerabilities of being involved in terrorist financing.
TBML Certification Syllabus
The syllabus for the Certification in TBML is designed carefully to address the needs of compliance professionals working in the International Banking domain. We endeavour to keep the course updated with the new developments in the domain. The syllabus also explores the regulatory frameworks and international standards aimed at combating TBML, such as those set by the Financial Action Task Force (FATF) and other regulatory bodies. Students gain insights into the challenges faced by financial institutions and businesses in detecting trade based money laundering red flags, as well as the role of technology and data analytics in enhancing detection capabilities.
Learning Outcome of CTE
On completion of the Certified Trade Based Money Laundering Expert course, the aspirants would gain
- A thorough understanding of the concept of Anti Money Laundering provisions related to International Trade
- A detailed explanation of the various methods used by criminals for TBML
- Identification of early warning signs of suspicious trade transactions
- Critical assessment of the role of banks and other intermediaries in the process of trade transactions
Registration
As soon as your payment is received, you need to go to visit the Profile page created for every member to make sure that all your admissions and certifications are reflected correctly. Once the registration is completed then you can also visit the course page to kick-start your e-learning journey with Riskpro Learning.
Sarat Palkurthy –
I am probably one of the first few students to complete this tbml certification. The course provides the content in book format as well as video learning. I liked the video learning format but reading the book gives insights into the world of international trade and abuse. Its written in absolutely laymans terms. Very easy to understand the technical jargons. Best thing is it explains the concepts in trade before it proceeds to elaborate trade based money laundering techniques. The examinations are little tough, the time flies away while completing the exams. Overall from admission to certification, it was a seamless process.