Webinar: Identifying human trafficking through AML and alternative data
In the latest Arachnys webinar, we welcomed Steve Farrer to join our CEO and co-founder David Buxton to discuss the prevalent issue of human trafficking and how banks can identify this criminal activity using alternative data in AML.
As one of the largest crimes by revenue, amounting to $150.2 million, human trafficking and forced labour poses a great challenge for banks. However, there are new ways of gathering alternative data sets to expose multiple parties at play in complex trafficking networks who look to launder the proceeds of their illicit material.
There has been a great focus on sex trafficking as just one arm of forced labour, but Steve goes into detail about the trafficking that can often go unseen due to its masking under ‘legitimate businesses’. It is estimated that labour exploitation accounts for around 68% of the total amount of human slavery worldwide.
Within construction, and in two particular case studies, Steve looks at the building of sport stadiums for the Russia World Cup in 2018, and the upcoming tournament in Qatar, with reports of forced labour in these highly publicised world events. Steve also identifies the extent to which false labour applies to international fishing and the agricultural industries, notifying how authorities in New Zealand were able to bring illegal fishermen to justice, and particularly how satellite techniques through Global Fishing Watch can be used to track criminal activity.
David goes on to explain further how AML techniques are adapting to the use of alternative data to crack down on human slavery; global shipping data can be used to detect trade-based money laundering and supply networks, for example. Alternative data works to discover both direct and indirect relationships to flag risk that can go undetected through other means of deterrent, such as placing entities on sanctions lists.
The webinar also contains a Q&A whereby Steve and David look to answer questions around which practical techniques are already being employed by banks to combat human trafficking, how banks can determine illicit activity when parties are connected to correspondent banks, and where human trafficking consideration should be incorporated into a bank’s existing AML processes or as a separate function.