Threat Assessment Calls Money Laundering a 'Massive' Challenge

Since the 9/11 attacks the Treasury Department and FBI have worked with foreign countries to strengthen global anti-money laundering laws and regulations. The Treasury Department, Justice Department and the Department of Homeland Security also work together in the Financial Action Task Force to monitor global money laundering. The controversial Patriot Act also contains several provisions requiring increased reporting for banking and financial institutions.

After the 9/11 attacks, much attention was focused on regulating informal money transfers, known as the hawala system, originally developed in India. Some challenges remain in detailing and understanding the scope of their use. "It is virtually impossible to ascertain the full extent of [Informal Value Transfer Systems] activity in the United States due to the opacity of the sector and the absence of registration."

Bulk-cash smuggling is a common money laundering technique which may be on the rise because of some anti-money laundering enforcement efforts.

The report cautioned that more data needs to be collected and that electronic and online banking and the decline in paper checks make it more difficult to track financial transactions. Also the working group has found that money remitters and money orders are too voluminous to accurately track down. The sheer scale of Western Union providers around the globe totals 196,000 agents in over 190 countries, for example, allowing money launderers to move their money virtually anywhere.

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