Alan, a European resident, helped his brother by exchanging various currencies in differing amounts at a financial institution. His brother managed a company in a neighbouring country, which operated both a photocopying business and a bureau de change.

Alan confirmed the legitimacy of the business by presenting documentation from the trade register of the European country where the bureau de change / copying shop was registered. However, the scale of the currency transactions and the fact that the funds were being brought across the border unnecessarily raised the suspicions of the bank clerk. He reported his concerns to his senior management who decided to disclose to the national FIU.

After the FIU had received the disclosure from the financial institution, enquiries against the national intelligence database seemed to show that, for both Alan and his brother, no negative intelligence was registered. Nevertheless, by exchanging intelligence with foreign FIUs the national FIU determined that the two brothers were the targets of an investigation for illegal drug trafficking in other European countries. The bureau de change / copying shop served solely as a cover for laundering the proceeds of the drug trafficking. Moreover, it appeared that the company was not authorised by regulators to operate as an exchange office and that, in fact, it had never even applied for such authorisation. The money presented at t h e financial institution could not therefore have originated from exchange office business . However, the quantities and type of the currencies also bore no relation to a photocopying business. The FIU forwarded the full analysis of the disclosure and additional intelligence to the judicial authorities .

The judicial investigation determined that Alan was acting as a courier for a criminal organisation. When he was arrested the police confronted him with the reported exchange transactions. Alan acknowledged undertaking the transactions, but declared that the funds had a legal origin. According to him they derived from his brother’s photocopying business.

However, at trial, the court rejected Alan’s defence. As highlighted by the analysis by the FIU, the type of currencies and the total amount of money exchanged - more than USD600,000 in two weeks - did not seem to resemble the expected turnover of a photocopying business. Apart from that, there was no logical reason why Alan had performed the exchange transactions a second country instead of the country where the business was established . The judge ruled against Alan and passed a two-year sentence for money laundering.

Indicators :

Large - scale cash transactions
Unusual underlying business action (cross-border travel to undertake simple transaction )
Unrealistic business turnover