Gail Alexan­der

Bil­lions un­der sus­pi­cion.

A to­tal of 1,831 Sus­pi­cious Trans­ac­tion and Sus­pi­cious Ac­tiv­i­ty re­ports worth $27 bil­lion were re­ceived over 2019 to 2020 by the Fi­nan­cial In­tel­li­gence Unit of Trinidad and To­ba­go - the most it has re­ceived in its 10-year his­to­ry.

The in­crease has been at­trib­uted to in­creased fraud­u­lent ac­tiv­i­ty - in­clud­ing re­sult­ing from the COVID-19 pan­dem­ic - and de­moni­ti­sa­tion of the cot­ton $100 notes.

How­ev­er, there was an 88 per cent de­crease in Sus­pi­cious Trans­ac­tion/Ac­tiv­i­ty re­ports on sus­pect­ed ter­ror­ism fi­nanc­ing, ap­par­ent­ly due to the col­lapse of the ISIS ter­ror­ist group.

The in­for­ma­tion came yes­ter­day from the FI­UTT’s re­port for Oc­to­ber 2019 to Sep­tem­ber 2020. It was laid in Par­lia­ment by Fi­nance Min­is­ter Colm Im­bert, who spoke on it.

In the re­port­ing pe­ri­od be­tween 2019-2020, the FI­UTT ad­just­ed its su­per­vi­so­ry ac­tiv­i­ties due to the chal­lenges of COVID-19.

The na­tion­al ef­forts to re­duce the po­ten­tial im­pact of the pan­dem­ic led to the tem­po­rary clo­sure of busi­ness in high-risk sec­tors such as pri­vate mem­bers’ clubs, ve­hi­cle sales and re­al state. But su­per­vi­so­ry and mon­i­tor­ing ac­tiv­i­ties con­tin­ued with the nec­es­sary ad­just­ments.

For this re­port­ing pe­ri­od, 329 en­ti­ties reg­is­tered with the FI­UTT - bring­ing the to­tal num­ber of reg­is­trants to 3,337 at Sep­tem­ber, 2020. This rep­re­sent­ed a 10 per cent in­crease from the pre­vi­ous re­port­ing pe­ri­od.

Dur­ing the re­port­ing pe­ri­od in the area of fi­nan­cial in­tel­li­gence - and for the first time - it was not­ed that the FI­UTT re­ceived a to­tal of 1,831 Sus­pi­cious Trans­ac­tion Re­ports/Sus­pi­cious Ac­tiv­i­ty Re­ports (STR/SAR).

This was the most it has re­ceived through­out its ten years of ex­is­tence. This rep­re­sent­ed an 80 per cent in­crease from the pre­vi­ous re­port­ing pe­ri­od.

Al­so, dur­ing the re­port­ing pe­ri­od, the FI­UTT not­ed a 141 per cent in­crease in (STR/SAR) sub­mis­sions from fi­nan­cial in­sti­tu­tions and an 80 per cent in­crease in the sub­mis­sions from list­ed busi­ness­es, com­pared to the pre­vi­ous year.

The to­tal mon­e­tary val­ue of the 1,831 STR/SAR re­ports re­ceived over 2019-2020 amount­ed to ap­prox­i­mate­ly $27 bil­lion. The fig­ure was $1.7 bil­lion in the pre­vi­ous re­port­ing pe­ri­od.

Of the 1,831 re­ports re­ceived, 1,517 were com­plet­ed trans­ac­tions worth $884.4 mil­lion.

But 314 at­tempt­ed trans­ac­tions were worth $26 bil­lion. The main rea­son for this was cus­tomers ap­proach­ing banks with sus­pect­ed fraud­u­lent con­tracts and pend­ing in­com­ing wire trans­fers.

On the over­all in­creas­es in sus­pi­cious trans­ac­tion/ac­tiv­i­ty re­ports, the FI­UTT’s re­port stat­ed, “When com­pared to the pre­vi­ous re­port­ing pe­ri­od, the sig­nif­i­cant in­crease in both the num­ber and val­ue of these at­tempt­ed sus­pi­cious trans­ac­tions can be di­rect­ly at­trib­uted to the fol­low­ing:

“In­crease in fraud­u­lent ac­tiv­i­ty – Nu­mer­ous cus­tomers be­ing scammed with fake/fraud­u­lent for­eign con­tracts to en­gage in busi­ness ex­pect­ing mil­lions of US dol­lars or Eu­ros to be wired to their lo­cal bank ac­count.

“Al­so, the COVID pan­dem­ic re­sult­ed in an in­crease in fraud­u­lent ac­tiv­i­ty be­ing per­pe­trat­ed against peo­ple. Trans­ac­tions that were flagged and stopped in­clud­ed nu­mer­ous third par­ty trans­ac­tions be­ing at­tempt­ed be­tween un­con­nect­ed par­ties un­der the guise of pay­ments for “gifts,” “bless­ings” or sou-sou.”

Al­so con­tribut­ing to the in­crease was the old $100 bill de­moni­ti­sa­tion process where sev­er­al trans­ac­tions were flagged and stopped.

Re­port­ing en­ti­ties were un­able to ver­i­fy the source of old bills due to the in­abil­i­ty of the peo­ple/en­ti­ties con­duct­ing trans­ac­tions to pro­vide suf­fi­cient proof of source of funds.

The FI­UTT’s re­port stat­ed that the de­mon­eti­sa­tion ex­er­cise of the old cot­ton-based TT$100 cur­ren­cy note re­sult­ed in a sig­nif­i­cant in­crease in the sub­mis­sions of STR/SAR re­ports by re­port­ing en­ti­ties - 750 re­ceived.

The FI­UTT is still see­ing STR/SAR from re­port­ing en­ti­ties re­lat­ed to the de­moni­ti­sa­tion process.

FI­UTT act­ing di­rec­tor Nigel Stod­dard stat­ed, “It is ev­i­dent that com­ing out of the de­moni­ti­sa­tion ex­er­cise, the amount of cash ex­change or at­tempt­ed to be ex­changed, lacked trans­paren­cy in cer­tain in­stances to prop­er­ly iden­ti­fy their source of funds.

“There­fore, such cash-in­ten­sive en­vi­ron­ments in­crease the risk of mon­ey laun­der­ing and fa­cil­i­tate crim­i­nal con­duct. This FI­UTT con­tin­ues to rec­om­mend that the au­thor­i­ties give se­ri­ous con­sid­er­a­tion to in­tro­duc­ing some form of cash thresh­old when con­duct­ing busi­ness in­ter­ests.”

Ponzi Sou, ro­mance scams

The re­port not­ed an in­creas­ing preva­lence of on­line scams and ponzi/pyra­mid schemes. Analy­sis re­vealed the ex­is­tence of crim­i­nal net­works where peo­ple were be­ing de­fraud­ed via on­line ro­mance scams, on­line mar­ket place scams and oth­ers.

Through fic­ti­tious In­ter­net pro­files, scam­mers de­vel­oped “ro­man­tic re­la­tion­ships with vic­tims. Al­so, in on­line mar­ket scams, scam­mers of­fered goods and ser­vices for sale and failed to de­liv­er the items af­ter part or full pay­ment.

This oc­curred as far back as 2018 but the pan­dem­ic fa­cil­i­tat­ed an in­crease in so­cial me­dia ac­tiv­i­ty, as well as op­por­tu­ni­ties for ex­ploita­tion by per­pe­tra­tors.|

It al­so stat­ed that there was a not­ed in­crease in the in­ci­dence of Ponzi/Pyra­mid schemes be­ing op­er­at­ed un­der the guise of “non-tra­di­tion­al sou sou” and op­er­at­ed as “in­vest­ments” schemes with the names Loom, “Giv­ing Cir­cle and Bless­ing Bank to name a few.”

Re­li­gious min­is­ters, po­lit­i­cal­ly-ex­posed peo­ple al­so probed

The Fi­nan­cial In­tel­li­gence Unit of T&T has not­ed that STR/SAR re­ports were done on 22 min­is­ters of re­li­gion and six on po­lit­i­cal­ly-ex­posed peo­ple in its last re­port­ing pe­ri­od. The lat­ter six is a 46 per cent de­crease from the pre­vi­ous re­port­ing pe­ri­od.

The FI­UTT not­ed that peo­ple in sus­pi­cious trans­ac­tion re­ports in­clud­ed self-em­ployed, from con­struc­tion, busi­ness own­ers and per­sons in the ho­tel, law and law en­force­ment fields. Pen­sion­ers/re­tirees were al­so not­ed.

In­creased sus­pi­cious trans­ac­tions - 30 per cent - were not­ed by re­port­ing en­ti­ties in Cen­tral Trinidad, fol­lowed by San Fer­nan­do and Port-of-Spain, north­ern T&T, West, the East and To­ba­go.

Sus­pect­ed tax eva­sion al­so ranked the high­est among the five most com­mon rea­sons for the sub­mis­sion of STR/SAR re­ports to the FI­UTT.

In the 2019-2020 re­port­ing pe­ri­od, the most com­mon sus­pect­ed crim­i­nal con­ducts list­ed by FI­UTT were tax eva­sion (539), mon­ey laun­der­ing (530), sus­pi­cious fi­nan­cial ac­tiv­i­ty (401), fraud (205) and drug traf­fick­ing (92).

These five sus­pect­ed crim­i­nal con­ducts ac­count­ed for 97 per cent of the to­tal num­ber of STR/SAR Re­ports sub­mit­ted and 99.89 per cent of the to­tal mon­e­tary val­ue of all STR/SAR Re­ports sub­mit­ted.

The FI­UTT re­ceived 12 STR/SAR re­ports on sus­pect­ed Fi­nanc­ing of Ter­ror­ism com­pared to 97 in the pre­vi­ous re­port­ing pe­ri­od. This rep­re­sent­ed an 88 per cent de­crease of Fi­nanc­ing of Ter­ror­ism-re­lat­ed STR/SARS and may be at­trib­ut­able to the ap­par­ent col­lapse of the ISIS. Eleven in­tel­li­gence re­ports linked to for­eign ter­ror­ist fight­ers were not­ed.