“CASH IS KING" among the organized crime organizations responsible for migrant smuggling, according to a recent FATF investigation.
According to the research, the gangs get the majority of their payments in cash and utilize the funds to meet living expenses and, in some cases, to maintain their drug and gambling addictions.
The FATF identifies many "business models" employed in migrant smuggling, including "travel agency" and "hop on – hop off" services along the smuggling route.
According to the watchdog, these smuggling networks operate on a "enterprise model," with "a huge number of smaller, more adaptable crime organizations or individual criminals that connect as needed."
“In regions where anti-smuggling law enforcement strategies are particularly robust, the smuggling networks tend to be more sophisticated,” said FATF.
The paper analyzes how earnings are integrated into legal enterprises like as retail establishments, travel agencies, and transportation corporations.
FATF said: “When money needs to be transferred between jurisdictions, it is usually through an informal money transfer system, known as hawala.”
Another example found is smurfing, whereby “smugglers make a large number of deposits of small amounts into bank accounts to avoid suspicion,” the report says.
The research emphasizes the proliferation of professional money laundering networks, with migrant smuggling organizations increasingly outsourcing their "money laundering activities."
FATF say migrant smugglers may also “invest their profits in real estate, high-value goods and legal businesses in both the countries of origin and the country of destination.”
Depending on the level of sophistication of the networks, several money laundering methods are used to “place, layer and integrate the money into the legitimate economy,” FATF adds.
According to the task force, it issued the report to “build awareness about the ways that migrant smugglers raise and move their funds to help in the detection of these financial transactions.”
By fLEXI tEAM