Category Archives: MONEY LAUNDERING TAX HAVENS

Typologies and case major crime studies report 2013 in Australia

 AUSTRAC takes action against three reporting entitiesAUSTRAC has taken enforcement action against MoneyGram, FNF First National Finance and Canberra Southern Cross Club.

MoneyGram

A record fine against MoneyGram, one of the world’s largest remittance network providers, was issued for systemic contraventions of Australia’s anti-money laundering and counter-terrorism financing laws.The fine brings the total fines paid by MoneyGram to almost half a million dollars.The fines were for providing money remittance services through unregistered remittance businesses.

Read the MoneyGram media release.

FNF First National Finance

The cancellation of Sydney-based remitter, FNF First National Finance, was issued due to significant money laundering or financing of terrorism risk. FNF was identified through the Eligo National Taskforce, which focuses on alternative remittance services and serious and organised crime. AUSTRAC plays an important role in the taskforce alongside other agencies.

Read the FNF First National Finance media release.

Canberra Southern Cross Club

AUSTRAC has required Canberra Southern Cross Club Limited to appoint an external auditor to assess and help improve its compliance with anti-money laundering and counter-terrorism financing laws. The notice follows an assessment by AUSTRAC that the club had extensive, longstanding, systemic and serious non-compliance with the AML/CTF Act and AML/CTF Rules. AUSTRAC’s concerns included that CSCC had:

  • an inadequate AML/CTF Program
  • no transaction monitoring program
  • significantly deficient customer identification procedures.

Read the Canberra Southern Cross Club media release.

AUSTRAC CEO, Paul Jevtovic reinforced the stance that AUSTRAC takes its role in combating money laundering and terrorism financing very seriously and we will not hesitate to take enforcement action where appropriate.


 Real estate agents and lawyers vulnerable to money laundering riskAUSTRAC has released two new reports to help Australian businesses identify money laundering methods used through real estate agents and legal practitioners.

AUSTRAC is Australia’s primary source of financial intelligence, providing expertise and global leadership on financial intelligence matters.

The reports provide information about money laundering methods, business vulnerabilities and indicators that a person is laundering the proceeds of crime.

Criminals are drawn to real estate investment in Australia because it can be purchased in cash, offers reliable financial returns and its ownership can be disguised.

Lawyers can also be used to facilitate the movement of illicit funds through their trust accounts and to invest in real estate.

AUSTRAC shares knowledge of money laundering methods and associated indicators to help businesses detect and mitigate attempts to launder the proceeds of crime.

Suspicious Matter Reports (SMRs) are an important tool in detecting, disrupting and deterring crime.

Businesses concerned that a person might be undertaking a suspicious transaction can lodge an SMR with AUSTRAC or call the AUSTRAC Contact Centre on 1300 021 037.


 Case Study: AUSTRAC information helps unravel $30 million construction fraudAUSTRAC information assisted law enforcement to investigate a network involved in defrauding a university of over AUD30 million.

Directors of construction companies and managers at the university were complicit in a large fraudulent invoice scheme. The managers approved the payment of highly inflated invoices from the construction companies, as well as approving invoices for work that was never undertaken.

Directors of the construction companies laundered the profits from the fraud by purchasing racehorses and property.The managers at the university were repaid with kickbacks or direct shares in racehorses.

AUSTRAC assisted law enforcement by investigating international funds transfer instructions (IFTIs) undertaken and received by associates of the suspects.

The associates were identified as accounting firms.It was discovered that funds were sent to many countries including New Zealand, Canada, Hong Kong and the USA.

The accounting firms also received a large number of IFTIs from various overseas entities that were similar in value to the amounts the firms had sent overseas. Authorities suspected that the accounting firms were laundering the funds on behalf of the suspects as part of a professional money laundering syndicate.

Authorities also believed that the money laundering was an attempt by the directors of the construction company to hide or disguise the ownership of property.

The directors distanced themselves from the racehorses by having the ownership of the horses held in the names of associates. The associates then returned any profits generated by the horses back to the directors.

The members of the network were arrested and convicted on a variety of charges, including conspiracy to defraud, obtaining property by deception, theft, aiding and abetting receipt of a secret commission and furnishing false information.

Ultimately, law enforcement laid more than 2,000 charges against the suspects. The suspects received penalties ranging from fines to six-and-a-half years imprisonment.

 Case Study: AUSTRAC information helps unravel $30 million construction fraudAUSTRAC information assisted law enforcement to investigate a network involved in defrauding a university of over AUD30 million.

Directors of construction companies and managers at the university were complicit in a large fraudulent invoice scheme. The managers approved the payment of highly inflated invoices from the construction companies, as well as approving invoices for work that was never undertaken.

Directors of the construction companies laundered the profits from the fraud by purchasing racehorses and property.The managers at the university were repaid with kickbacks or direct shares in racehorses.

AUSTRAC assisted law enforcement by investigating international funds transfer instructions (IFTIs) undertaken and received by associates of the suspects.

The associates were identified as accounting firms.It was discovered that funds were sent to many countries including New Zealand, Canada, Hong Kong and the USA.

The accounting firms also received a large number of IFTIs from various overseas entities that were similar in value to the amounts the firms had sent overseas. Authorities suspected that the accounting firms were laundering the funds on behalf of the suspects as part of a professional money laundering syndicate.

Authorities also believed that the money laundering was an attempt by the directors of the construction company to hide or disguise the ownership of property.

The directors distanced themselves from the racehorses by having the ownership of the horses held in the names of associates. The associates then returned any profits generated by the horses back to the directors.

The members of the network were arrested and convicted on a variety of charges, including conspiracy to defraud, obtaining property by deception, theft, aiding and abetting receipt of a secret commission and furnishing false information.

Ultimately, law enforcement laid more than 2,000 charges against the suspects. The suspects received penalties ranging from fines to six-and-a-half years imprisonment.

LOT MORE HERE BELOW OF BIG TIME SCAMS & FRAUD-CLICK ON typ13_full

The 2013 report includes 23 real-life case studies showing how legitimate services offered by Australian businesses have been exploited for criminal purposes, including for drug trafficking, child exploitation, fraud and tax evasion. By highlighting past examples of criminal activity, the report educates businesses on their money laundering and terrorism financing risks and helps them recognise and mitigate these risks.

The full case study (#5) is available in the typ13_full. It includes a diagram of the different money laundering methods used in the case. 

VIEW EARLIER RPORTS HERE BELOW

Typologies and case studies report 2012

View the report below or download the full PDF here:

AUSTRAC typologies and case studies report 2012 (PDF, 2.3MB)

AUSTRAC’s 2012 typologies report is the sixth in an annual series of reports produced by the agency.

The 2012 report includes 21 real-life case studies illustrating how legitimate services offered by Australian businesses have been exploited for criminal purposes. By highlighting these past examples of criminal activity, the report educates Australian businesses about their money laundering and terrorism financing risks and helps them recognise and mitigate these risks.


Typologies and case studies report 2011

View the report below or download the full PDF report here:

AUSTRAC typologies and case studies report 2011 (PDF, 3.6MB)

AUSTRAC’s 2011 typologies report is the fifth in an annual series of reports produced by the agency.

The 2011 report includes 20 real-life case studies illustrating how legitimate services offered by Australian businesses have been exploited for criminal purposes. By highlighting these past examples of criminal activity, the report educates Australian businesses about their money laundering and terrorism financing risks and helps them recognise and mitigate these risks.

If you have any feedback about AUSTRAC’s typologies and case studies reports, or ideas for future topics, please email INTEL_TYPOLOGIES@austrac.gov.au.

Typologies and case studies report 2010

View the report below or download the full PDF report:

AUSTRAC typologies and case studies report 2010 (PDF, 4MB)

The AUSTRAC typologies and case studies report 2010 is the fourth in a series of reports AUSTRAC has produced to educate Australian businesses about their money laundering and terrorism financing risks, and assist them to recognise and guard against these risks in the future.

The 2010 report includes 31 real-life case studies illustrating how Australian businesses have been misused by criminals to commit a range of serious offences, including drug importation and trafficking, identity fraud, and money laundering.

If you have any feedback about AUSTRAC’s typologies and case studies reports, or ideas for future topics, please email INTEL_TYPOLOGIES@austrac.gov.au.

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Henry Sapiecha

AUSTRALIAN GOVERNMENT ANTI TERRORISIM & MONEY LAUNDERING WEB SITE

austrac-website-logo image www.newclearservices.com

Review of the AML/CTF Act, Rules and regulations
Submissions for the issues paper on the review of the AML/CTF Act, regulations and AML/CTF Rules closed on 28 March 2014. Information on further stakeholder engagement will be issued after submissions have been considered by the Attorney-General’s Department (AGD) and AUSTRAC.

More here…http://www.austrac.gov.au/

Henry Sapiecha

Australian Federal Police seize millions from the bank accounts of nine Russian business people

Nine Russian nationals used a Gold Coast ANZ bank to wire large sums of money from companies in Asia.image www.crimefiles.net

Nine Russian nationals used a Gold Coast ANZ bank to wire large sums of money from companies in Asia. Photo: Glenn Hunt

The Gold Coast branch of the ANZ Bank sees its share of wealthy new customers, but few could match the smartly-dressed tourists with Russian accents who opened accounts in 2011.

Within days of setting up the accounts in the heart of Surfers Paradise, the money started rolling in in the form of six- or seven-figure wire transfers from companies in Asia.

First came several hundred thousand from an account in Hong Kong, then just weeks later another six-figure sum, then half a million from an account in China, then several more transfers. Eventually there was almost $29 million in accounts in the names of nine Russian nationals.

Late last year Federal Police moved in, raiding homes on the Gold Coast and taking action in Queensland’s supreme court to freeze the cash under money-laundering laws.

Police in the court argued that the Russians, from Irkutsk in Siberia, did not earn enough to justify the vast sums.

The Russians, who remain in Siberia, hit back, hiring their own lawyer and rejecting the allegations.

This week Fairfax Media has learnt some of the nine have been the subject of media reports in Russia linking them to alleged tax avoidance and failed companies. They are alleged to have been involved   in the jade mining industry in an area which has seen a series of violent robberies and deadly

shootings.

The Russians have denied the allegations, with one of their number saying the group were only trying to close a deal in Queensland that would have involved the export of Australian powdered milk to Siberia.

And their Gold Coast-based tour guide, whose post box was used to receive correspondence for their ANZ bank accounts, says they were legitimate business people looking to invest and send their children to one of the Gold Coast’s top private schools.

The dispute provides a snapshot of the global movement of shadowy funds out of eastern Europe’s turbulent economy and the attractiveness of destinations such as the Gold Coast as a financial haven.

The first to arrive on the Gold Coast on December 30, 2010, was a party of five: Eduard Zelinskiy, Irina Strelnikov and Vladimir Strelnikov and Natalia Gudkova and Andrey Gudkov.

All five listed on their visa applications some connection with the Siberian-based Baikalkvartssamotsvety or Baikal Quartz Gemstones company, which mines precious and semi-precious stones west of Irkutsk.

All opened the accounts in about January 2011, then returned to Russia.

Two months later more Siberian associates with a connection to the mining company landed on the Gold Coast and made their way to the ANZ Bank to open accounts.

In March 2011 the quartz company’s commercial director, Eduard Karmadonov, 45, came for a visit. Police believe he earned about $24,879 a year but his ANZ account showed $12 million, while his wife Elena Karmadonova, 35, who accompanied him, finished up with $843,306 in her ANZ account.

Then there was the general director of the mining company, Sergey Kostyukov, 50, who visited about the same time and set up an account. Mr Kostyokov, who police believed earned $65,005 a year, eventually notched up about $2.9 million in his ANZ account.

Even the medical officer of the company, Galina Chuvasova, 49, tagged along for the trip and despite an annual income estimated by the police as being about $12,640, had $650,832 in her ANZ account.

Once on the Gold Coast, the Russians used the services of  tour guide Tamara Allnutt, who allowed them to use her post box to receive correspondence. She denies any impropriety and swears the group were legitimate business people.

“What we think is a lot of money to us is not necessarily so to them. Not every Russian businessman is a crook. Some are genuine people here to invest in the Gold Coast. They have businesses and they wanted to invest in Australia. They were more interested in dairy products.”

Visa debit charge records placed on the court record by the police reveal extraordinary expenditure overseas by Mr Karmadonov, who reportedly spent $1.008 million between March 2011 and September 2013, while his wife spent $189,759 between January 2012 and September 2013, all in exotic destinations throughout Europe and Asia.

Police in their legal action say they suspect the money is “the proceeds of an indictable offence or offences”.

But earlier this year Sydney lawyer Igor Kazagrandi in court documents said the respondents denied the money was the proceeds of unlawful activity.

Russian media have reported on some of the nine Siberians and there have also been reports of violent robberies at the Baikal Quartz mine and a deadly shooting nearby.

One online newspaper alleged Mr Kostyukov and Baikal Quartz Gemstones had been investigated for failing to pay taxes of about $300,000 and for fraudulently filing for bankruptcy.

Speaking from Irkutsk, Mr Kostyukov  denied any impropriety and said the group were in Australia to set up the dairy exports.

Asked about the quartz mining business, he declined to comment.

On Monday, in the Supreme Court as part of their action to seize the money, the Federal Police filed requests for subpoenas for two dairy products companies based in Brisbane.

An employee at one of the companies confirmed some Russians had been in touch to discuss a dairy products deal but he said he did not know anything about any subpoenas.

A spokesman for the ANZ Bank said they could not comment on customers. The Australian Federal Police declined to comment because the matter was before the court.

Further court hearings are expected before the end of the year.

Henry Sapiecha