Many criminals and terrorists use trade-based money laundering (TBML) to procure money for their malicious deeds. A primary TBML tactic is mis-invoicing by showing incorrect price, quantity or other goods details during trade transactions. Such transactions usually involve goods like precious metals, electronic items and automobiles. Despite TBML being a common route for international money-laundering, it is difficult to detect it.
To combat TBML, the US Immigration and Customs Enforcement’s Trade Transparency Unit (TTU) has collaborated with 17 countries for the exchange and analysis of trade data. The TTU program has faced many issues, such as lack of adequate information sharing, differences in the data systems used etc.
To help resolve such issues, the US Government Accountability Office (GAO) conducted its research by collecting and analysing US agency and international body data. Based on the research, the GAO has given two recommendations to combat TBML. GAO recommends that ICE should come up with a strategy to improve the effectiveness of the TTU program. Further, ICE must develop a performance monitoring framework for the program. While the authorities agreed with the first recommendation, they did not agree with the second.
Additionally, relevant international bodies and selected partner countries have also made some recommendations which GAO has summarized. They suggest that there should be an increase in public-private partnerships, domestic interagency data sharing, training and international cooperation.