Federal and state police are being outgunned by sophisticated crime syndicates, drug imports are rising and authorities must take on new crime-fighting techniques, according to a Federal Government report.
The Australian Government Jurisdictional Report — prepared for an inter-governmental meeting on money laundering held in Sri Lanka this week — delivers a damning assessment of the national struggle to combat "highly resilient" crime groups that funnel billions in dirty money offshore.
The report also warns of organised crime's infiltration of the sharemarket and the need for authorities to use new ways of "identifying the money trail".
The report says "investigations conducted by the ACC (Australian Crime Commission) suggest that most profit-driven organised crime-related activities continue to escape the detection of state, territory and federal law enforcement agencies".
"Most criminal proceeds also escape the detection of AML (anti-money laundering regulators) and there is a significant gap between the known values of proceeds of crime being transferred abroad and what is identified by law enforcement, AUSTRAC and the financial sector," the report says.
The amount of illicit drugs imported into Australia "may have previously been underestimated by a significant margin", the report warns, noting that cocaine trafficking is rising fast and ecstasy is in high demand.
The report was tabled this week at the Asia Pacific Group on Money Laundering in Colombo, Sri Lanka, whose co-chairman is Australian Federal Police Commissioner Mick Keelty.
It was compiled by several police agencies, including financial watchdog AUSTRAC and the ACC, the nation's peak criminal intelligence agency.
In a swipe at traditional anti-drug law enforcement, the report says the recent work of the ACC and AUSTRAC "proves that intelligence-driven investigations into large-scale money laundering are highly successful", and has led to the arrest of criminals who had "previously been undetectable".
The report says a recent ACC operation focusing on criminals working with four money remitters in Sydney and Melbourne found that $300 million of drug money had been sent offshore.
"The value of funds currently being remitted to high-risk countries is today higher than immediately before the (operation's) arrest phase," the report says.
ACC modelling reveals that up to $12 billion in dirty money is being pumped overseas annually, much of it to Asian-based criminal syndicates.
The report says corrupt money movers are devising ways to circumvent Australia's new laws on money laundering and terrorist financing. The ACC has "serious concerns" about the self-reporting standards of hundreds of small money remitters.
The report warns that the Australian sharemarket can be illegally manipulated by organised criminals or terrorist financiers. The "money laundering and terrorism financing techniques (that) exist within the securities sector" include the use of front companies and pump-and-dump schemes, in which share prices are artificially forced up via assaults on stocks with criminal funds.
"In instances such as this, criminals may profit twice: once from their initial criminal activity, then again from the increased share prices."
The report also says the introduction of a carbon emissions trading scheme "will provide opportunities for exploitation by organised crime groups".
Among the case studies in the report are cocaine importers who created bank accounts in the names of their infant grandchildren to buy luxury cars and properties. Investigators also found that a drug trafficking group had used online soccer betting to offset their drug debts and earnings.
Posted by Michael Hearns from www.launderingmoney.com and http://launderingmoney.blogspot.com
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