The detection and conviction of organized crimes have become the chief challenges for law enforcement agencies and judiciary. With the advancement in technology by manifolds in the recent decades, criminals have adopted advanced means to conceal the illegal money. Consequentially, Investigation agencies have designed ways to counter the offenders. It is essential to document the most brainy ways of violations and the path followed by investigators to decipher those methods so that the concealed and apparently legitimate crimes can be tracked.
The prime objective of money launderers is to dodge security and exchange commissions which are placed to ensure legal money trail. To avoid apprehension, offenders use legitimate accounts and individuals to transfer illegally obtained money into a legal account through legitimate means. Usually, money launderers commingle the illegitimate money with lawfully attained wealth so that illegal money appears to be obtained through a permissible channel. Another method used by criminals is to use sell a product in “black”. Offenders obtain the product at extraordinary discounts by showing legitimate documents to fund charities and welfare organizations (Boles, 2017). However, the product is sold at a greater price which allows them to attain huge profits. The offense goes unnoticed because of legitimate documentation.
A case from Kansas was reported where four pharmacies were established by criminals who obtained drugs at discounted prices. The perpetrators had a thorough documentation to prove the legitimacy and they resold it to wholesalers of California and Nevada achieving profits of over a million dollars in two years. These pharmacies were counterfeits and the owners of the original pharmacies who’s names were used remained unaware of the development. (Conlan, 1991). The scam was traced by a drug regulator with the help of FBI. The regulator noticed none of the drugs purchased by the company were meant for old aged people despite the fact that discounts were sought in the name of nursing homes (Conlan, 1991).
Researchers have formulated Social Network Analysis (SNA) to track criminal networks, especially money laundering. The approach categorizes criminals into two kinds. The first kind of group also known as “social capital” are those who have deep links with other offenders. They serve as the mediators or brokers too between other criminal gangs. The other groups of criminals called “human capital” have specialized skills or have a great amount of wealth. Social capital is more difficult to track for their inter-connectivity which reinforces each of the gangs. By using SNA, researchers assign attributes to each suspect on the basis of their calls and in-person contact with other alleged offenders (Bright et al., 2017).
The Patriot Act of 2001 reinforces the Anti Money Laundering (AML) laws by obliging financial institutions to assist concerned security agencies with classified relevant information. Financial Action Task Force (FATF), the global body that looks after the money laundering, has applauded AML in 2016 as being comprehensive and effective.
Although SNA is a sound approach to deal with legitimate crimes, it has seen a backlash too for the role in compromising privacies and liberties. While establishing connections among criminal gangs, a vast number of people have to undergo the investigations, usually, they are unaware of. AML is effective too to track human capital by studying the information from financial institutions but tracking social capital is still a challenge and only a partial success is achieved. At times, jurisdiction issues delay the investigation which allows violators to evade the law.
The offenders are benefitting from the vulnerabilities in systems and laws. The governments around the world need to increase the cooperation to eliminate the interoperability of criminal gangs. Besides legislation, technologies like SNA should be implemented to track down the large-scale organized crimes.
Boles, J. R. (2017). Anti-Money Laundering Initiatives for the South African Real Estate Market. Journal of Comparative Urban Law and Policy, 1(1), 14.
Conlan, M. F. (1991). Organized crime linked to drug diversion scam. Drug Topics, 8, 48.
Bright, D., Greenhill, C., Britz, T., Ritter, A., & Morselli, C. (2017). Criminal network vulnerabilities and adaptations. Global Crime, 18(4), 424-441.