Sector assessment
18 laundering methods apply to this sector. 6 are rarely covered in standard AML training. The sector assessment uses 11 cases.
Trade laundering is documentary. The paperwork is produced to be plausible, and is usually checked file by file rather than read as a set.
Documents are checked individually for completeness rather than cross-read as a set. The highest-signal findings, such as invoice numbers running in unbroken sequence across unrelated customers, only appear when all the documents are read together.
FATF has issued repeated typology work on trade-based money laundering and extended it to supply-chain and receivables finance. Free-trade zones and negotiable documents of title remain a structural blind spot for the whole sector.
This is written for the bank or finance house providing the facility, which is the regulated party. The traders, freight forwarders and inspection agents whose documents you are reading are mostly outside the Money Laundering Regulations, which is exactly why the pack arrives having been checked by nobody with an obligation.
Not one case. Every case that exercises a typology on your list is part of your mark, weighted by how much of your exposure it carries. The weights are derived from the register rather than chosen, so adding a case re-derives them instead of leaving the old ones wrong.
| Case | Your typologies | Share of your mark |
|---|---|---|
| The Goods Chainwritten for your desk | 7 | 30% |
| The Trade Corridor | 4 | 17% |
| The Policy Book | 3 | 13% |
| The Invoice Pack | 2 | 8% |
| The Relationship Review | 2 | 8% |
| The Collection Network | 1 | 4% |
| The Merchant Book | 1 | 4% |
| The Onboarding Interview | 1 | 4% |
| The Securities Book | 1 | 4% |
| The Sponsorship File | 1 | 4% |
| The Verification Desk | 1 | 4% |
£99one payment, 12 months, nothing renews
£750pilot, up to 25 people, invoiced
Drawn from the full register and filtered to this sector. Each entry states what the typology looks like inside your own systems, and names the source it came from. 18 of the 18 are currently exercised by an assessment case; the rest are documented here and not yet built into one.
Physical currency is consolidated and moved across borders by courier, vehicle or freight, avoiding the banking system entirely until it reaches a jurisdiction where placement is easier.
The banking exposure sits either side of the movement: aggregation of cash before departure through connected accounts and businesses, and placement afterwards in the destination jurisdiction with no corresponding trade.
Layered holding structures across free-zone and offshore jurisdictions terminate in a corporate nominee, so the declared beneficial owner is asserted rather than evidenced.
A structure chart that never evidences control, a nominee shareholder defeating verification, and a customer who offers further documents instead of an answer.
An entity that does not trade is given everything a due diligence check looks for: a website, product imagery, a founder with a biography and video presence, filed documentation and a digital footprint, all generated rather than earned.
A corporate customer or merchant whose entire evidenced existence post-dates its application, imagery and copy that cannot be traced to any real premises or product, a domain registered shortly before onboarding, and referees who exist only online.
Advisory, market-access and logistics consultancy invoiced in round sums with no hours, rates, deliverables or dates. Services carry no customs reference value, which is why the typology migrated from goods.
Round-figure invoices, no schedule of services, fee levels the file does not justify, and counterparties incorporated shortly before the contract date.
Invoices are raised on customers sharing a registered office, a director or ownership with the client, so the receivables being financed are the client's own money circulating.
Shared registered offices, a recently resigned common director, and invoice numbers running in unbroken sequence across supposedly unrelated customers.
Professional laundering networks settle obligations by offsetting: cash is delivered to a criminal group in one country while an equivalent sum is credited in another, with no cross-border transfer. Purchasing agents buy luxury goods on cards and settle the balances with criminal cash.
Card accounts repaid in cash or by unrelated third parties, purchase volumes far exceeding personal use, and paired domestic flows in two jurisdictions with no instrument connecting them.
A document of title is endorsed from party to party to settle obligations. Value transfers repeatedly with no payment crossing any bank, and the goods need not move or exist as described.
Almost nothing. Exposure appears only where the document is presented for finance or the goods are inspected, and free-trade zone storage makes physical verification unlikely.
A real export at a real price leaves surplus foreign currency offshore, which is then sold domestically at a premium against a cover purchase, moving value out of a capital-controlled currency.
Offshore receipt accounts holding balances well above production cost, cover purchases of high-value goods with no commercial logic, and settlement rates away from market.
Illegally sourced timber, minerals, fish, wildlife, waste or oil is commingled with legitimate product early in the supply chain, after which the two are indistinguishable and the proceeds enter the financial system as ordinary commodity trade.
Commodity trade finance where volumes exceed the licensed or certified capacity of the stated source, certification and permit documentation that cannot be reconciled to the shipment, and front companies with no operational footprint at origin.
Tobacco, alcohol and fuel are diverted from duty-suspended movement or manufactured illicitly, and the proceeds are placed through wholesale and retail businesses that plausibly handle the same goods.
Wholesale accounts with purchase volumes inconsistent with declared duty, rapid movement of goods between connected traders, and cash takings at retail exceeding what the site can support.
Counterfeit product is sold through online marketplaces and social channels, with proceeds settled through payment service providers and consolidated by aggregators before repatriation.
Merchant accounts with high chargeback and dispute rates against a narrow product range, settlement to beneficiaries unrelated to the listed merchant, and rapid rotation of storefronts under the same banking relationship.
Cash buys gold, gold crosses borders as scrap, jewellery or dore, and refining resets its origin. Bars are also used to move value physically, sometimes with counterfeit cores.
Bullion dealer and refiner accounts with volumes inconsistent with declared sourcing, and national export statistics exceeding any domestic mining or refining capacity.
Watches, vehicles, gemstones and collectables convert cash into portable value that resells readily and carries no ownership registry, moving across borders as personal property.
Dealer accounts taking third-party payments for goods delivered to someone else, part-exchange chains that never settle in cash, and customers whose purchases exceed any evidenced income.
Improper payments are routed as consultancy fees, royalties, dividends or capital gains so the receipt reads as ordinary income.
Consultancy receipts from jurisdictions where the recipient holds influence, payments unconnected to any deliverable, and timing correlated with contract awards.
Goods are traded through a chain of companies across borders. A trader collects VAT and disappears before accounting for it, while the goods may circulate repeatedly through the same chain.
Rapid high-value trading between newly incorporated counterparties in the same goods, payments that pass through in hours, margins too thin to support the businesses, and directors with no trading history in the sector.
Ownership is diluted below control thresholds or transferred to non-designated relatives and managers after designation, leaving effective control unchanged.
Ownership changes closely following a designation date, incoming owners with no commercial history, and unchanged management across the restructuring.
Ageing tankers under opaque ownership carry sanctioned cargo, disabling or falsifying position reporting and conducting ship-to-ship transfers at sea so the cargo's origin is severed from its documentation.
Trade finance and insurance exposure to vessels with dark intervals during loading, attestations that cannot be reconciled with position history, charterers and shipowners incorporated shortly before the voyage, and repeated changes of flag and name.
Controlled components are exported to an intermediary in a non-sanctioning jurisdiction and re-exported onward, with the end user misdeclared at the first hop.
Sudden growth in trade finance for electronics and machinery through transhipment jurisdictions, buyers incorporated after the export controls took effect, and end-user statements inconsistent with the buyer's business.
The Goods Chain carries 7 of the 18 typologies above and 30 per cent of your mark. Full debrief, no account, no card.
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One documented case each week. One decision. The answer and the source afterwards.
