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Last updated on 10 November 2022

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Strategic Analysis Report on Trade-Based Money Laundering (TBML)

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2 September 2021

Strategic Analysis Report on Trade-Based Money Laundering (TBML)

UAE is recognized as a country with diverse and multicultural population with a secure and stable economy and strong institutions. It has an accessible financial system, a dynamic market, strategic geographic location between Asia, Europe, the Middle East and Africa and its well-developed international trading and financial hub. Criminals can exploit the inherent characteristics of the UAE in a number of ways for ML/TF, - including but not limited to - through Trade-based Money Laundering (TBML).

 

TBML is the process of disguising the proceeds of crime and moving value using trade transactions to legitimize their illegal origin or finance their activities (the aim, unlike trade-related predicate offences, is not the movement of goods, but rather the movement of money, which the trade transactions facilitate).

 

The report found 6 emerging typologies associated with possible trade-based money laundering (TBML) activities:

  1.    Use of back-to-back letters of credit
  2.    Presentation of fictitious documents
  3.    Phantom shipments (or fictitious trades)
  4.    Over or under-invoicing
  5.    Accounts used as a pass-through
  6.    Use of shell and front companies

 

Click here to read the full report.