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Albanian crime syndicate used online betting service to launder drug proceeds

Image of computer, poker chips and credit card

An Albanian organised crime syndicate operating in Australia used an online betting service and an internet payment system to launder illicit proceeds from the sale of cannabis. The syndicate used the two services together to receive international transfers and move funds offshore.

AUSTRAC identified an increase in international funds transfer instructions (IFTIs) to and from Albania which had originated from the same location in Australia. AUSTRAC analysed the IFTIs and identified a large network of entities.

AUSTRAC information revealed the two online services operating from the same physical address. A suspect transaction report (SUSTR) submitted to AUSTRAC identified a director of the internet payment system making domestic transfers to the online betting service. This link between the two services raised the possibility that the financial activity was an attempt to conceal the origin of illicit funds.

The network of entities used the internet payment system to:

  • transfer value between members via online accounts
  • act as a remittance service that used a domestic bank to conduct international funds transfers – since the resultant international funds transfer instruction recorded the ‘remittance service’ as the sending customer, this method camouflaged the identity of the actual ordering customer.

Similarly, the network used the online betting service to:

  • store funds and make them accessible to other network members through sharing account passwords
  • remit and receive international funds transfers
  • create the illusion of paying ‘gaming winnings’ to members of the network and offshore entities, even though no inward transactions were recorded to justify an initial bet – analysis of this activity indicated the funds were not winnings but were for possibly illicit purposes.

The network also engaged in other suspicious transactions. The two online services transferred funds to customers in Sweden and the Philippines, but never received funds in return. The network also requested incoming international funds transfers of set, rounded-values (eg. AUD5,000) and in specific foreign currency amounts which were conducted over a single week. Large sums were transferred irrespective of any impact international foreign exchange rate changes may have had on these transactions.

Over an 18-month period the two online services received more than 600 incoming IFTIs valued at more than AUD26 million. Over the same period, they were recorded on AUSTRAC’s database as having conducted more than 140 outgoing IFTIs worth more than AUD15 million. Funds were predominantly sent to and received from Albanian entities and were believed to be proceeds from the sale of cannabis. Analysis of the IFTIs revealed many of the customers of the two services had routed their payments via financial institutions in the United States in an attempt to further conceal the origin of the funds.

The ‘Potential vulnerabilities’ section of this report details the vulnerabilities of online gambling services and online methods of value transfer. The activities described in the case above demonstrate how different online platforms can be used in conjunction to manage criminal financial activity and conceal money trails.

Case 16– Albanian crime syndicate used online betting service to launder drug proceeds

Case 16– Albanian crime syndicate used online betting service to launder drug proceeds

Offence

  • Money laundering
  • Drug trafficking

Customer

  • Business
  • Individual

Industry

  • Remittance services
  • Gambling services
  • Banking (ADIs)

Channel

Electronic

Report type

  • IFTI
  • SUSTR

Jurisdiction

International – Albania, the Philippines, Sweden, United States

Designated service

  • Remittance services (money transfers)
  • Gambling services
  • Account and deposit-taking services

Indicators

  • Company receiving and sending large value and volume of IFTIs inconsistent with their business profile
  • Customer undertaking non-economic transaction
  • Large value and volume of IFTIs to a high-risk jurisdiction
  • Multiple incoming IFTIs at a set and/or rounded amount, transferee unconcerned about losing value due to foreign currency exchange rate changes
Last modified: 21/08/2015 13:14