Research Questions and Case Studies

Research Questions and Case Studies

Research Question

  1. Informal Value Transfer System (IVTS) refers to alternative avenues to conventional banking systems and may in certain instances have significant interaction with conventional banking systems. IVTS is related to money laundering in particular because it is preferred and often used by criminal organizations who want to conceal their illegal activities and avoid detection.
  2. Hawala which traditionally operates in the Muslim world refers to an agency or a system for money transfer that involves an agent whom the money is paid to, who then provides instructions to a remote associate to make payment to the final recipient. This money transfer method transfers money without any actual money movement.
  3. In light of the terrorist attacks of September 11th 2001 on the U.S. it has become absolutely important and necessary to keep accurate records of transactions and to identify money transfer customers in every money transfer agency. This is because anonymous money transfer networks are being used by terrorists and criminal to fund terrorism and their illegal activities. This makes it difficult to track them, stop them and apprehend them.

1: First Case Study – Leases

To determine whether the internet payments are the basis for a money laundering scheme, it would be necessary for Betty to conduct customer due diligence that go beyond the determination of the identity of customers to ascertaining the purpose and intended nature of the business relationship. This would involve collecting customer information, their business information, and the continuous monitoring of the business relationship to make sure they are consistent with the information and intentions provided.

2: Second Case Study – Print Me up Some Money

Placement: When Bloom uses the money ($500,000) received in his shell company; Island Printing, from Alburton to buy out his shares in Z-Print with a $50,000 payment to his father-in law for his cooperation in the scheme.

Layering: The setting up of the new shell company Island Printing LLC, the invoice from Alburton to Island Printing for printing services, the selling of his (Bloom) shares from Z- Print LLC, and the buying of Z-Print shares by Island Printing. The recording of the $50,000 paid to Bloom’s father-in-law for his cooperation in the scheme as a salary increase.

Integration: The two transfer payments of $250,000 each over a four month period for the sales transaction.

  1. Third Case Study – Joey Nariz

a) The possession of too much liquid cash is a big problem and one that can act as a red flag to the authorities. For instance, if the seller of the house decides to make a bank deposit for the money he receives for selling the house under the table in amounts larger than $10,000 then he would need to report this to the authorities and would be required to provide details that include the origin of the money. In this case, this would raise eyebrows and if an investigation is launched, a trail my lead back to Joey, in which case his money-laundering scheme would not work. If however, all the parties involved in the transaction; Joey, the real estate agent, the seller of the house and the attorney conduct themselves in ways that do not raise suspicion th

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