Reports of Money Laundering On The Rise In Israel

Reports of fraudulent monetary transactions in Israel and abroad have skyrocketed in the past five years, the Ministry of Justice announced on Tuesday.

The number of “unusual reports” by banks and financial institutions is up by 75% since 2012, the Justice Ministry said in its newly-released annual 2016 report.

Money laundering – the practice of concealing the origins of illegally-obtained money – helps finance terrorist and criminal groups.

Around 11% of detected unusual activity in Israel and abroad pertained to financing terrorist organizations, according to data compiled by the Israel Securities Authority (ISA).

The primary national investigator of financial fraud, the ISA, said that 30% of money laundering activity in 2016 consisted of fraud and forgery.

Another 20% of criminal transactions pertained to bribery and the embezzling of public funds.

Currency providers detected an increase in fraud by one-and-a-half times in the past year. Other reports of irregular activity came from insurance companies and credit card companies.

An uptick in cooperation between Israel and other law enforcement agencies may explain part of the rise in reported fraud, the Justice Ministry report said. In the past year, international securities regulators have made nearly 25% more requests for information from the ISA.

Israel’s securities regulator has also expanded its online reporting system, making it easier for people to submit claims as to suspicious financial activity.

Money laundering most commonly occurs via cash payments. Other methods included currency service providers, international bank transfers, parking funds in real estate and companies and straw people, or when a person acts as a registered front while the real owners hide in the legal shadows.

Dr. Shlomit Wagman, head of the Israel Money Laundering and Terror Financing Prohibition Authority, touted the increase in reported fraud as a sign of greater law enforcement.

“In the past year, the Authority has made a significant leap forward in cooperation with security and enforcement agencies in Israel and around the world, initiating and accompanying an unprecedented number of economic investigations, including organized crime, sophisticated and cross-border economic crime, financing of terrorism and government corruption,” Wagman said.

“The effectiveness of the Authority’s activity this year also received significant international recognition,” she added. “Which is reflected in winning first place in an international competition and the inclusion of Israel as an observer to the prestigious Financial Action Task Force organization, [an inter-governmental group fighting money laundering through an extensive blacklist.]”

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply