NCJ Number
194832
Journal
Journal of Financial Crime Volume: 9 Issue: 3 Dated: February 2002 Pages: 277-285
Date Published
February 2002
Length
9 pages
Annotation
After identifying the primary sources of illegal proceeds, this paper addresses the more commonly used methods of money laundering in the Asia Pacific region, followed by a discussion of some of the specific and general countermeasures that have been used by the Singapore authorities to counter money laundering within the context of electronic commerce.
Abstract
Narcotics trafficking remains the single largest source of criminal proceeds, with the next largest sources being the various types of fraud, smuggling, casino gambling, and human trafficking. In describing common methods of money laundering, this paper discusses the use of banks, alternative banking systems, the use of other non-financial institutions, and e-commerce and e-financial services. Regarding the latter method, customers normally can have easy access to their e-financial accounts from personal computers. Since access is indirect, the financial institution will not be able to verify the identity of the individual accessing the account. Further, with the Internet, a customer can access his/her account from virtually anywhere in the world, thus making the task even more challenging. There is an urgent need to harmonize and draft laws on the registration of commercial companies that use the Internet and do business by electronic means. Countermeasures include reinforcing current customer identification requirements to ensure that what are essentially anonymous accounts are not being established. Another measure is to establish new procedures that will facilitate the ability of financial institutions to know their customers over the life of the business relationship. Further, new information technology capabilities should be developed to permit both the detection of suspicious online transactions and verification of the customer. Unlicensed financial institutions should be prohibited from offering their services. In Singapore, laws have been broadened to provide a proper legal framework within which new technology is not merely accepted, but embraced. Singapore is an active member of the Financial Action Task Force and is also a member of the Asia Pacific Group on Money Laundering, which promotes the adoption and implementation of internationally accepted anti-money laundering standards. 25 references