Why understanding income is important – NCA uncovers money-laundering in drugs case

In a recent landmark case, a married couple was convicted of orchestrating a sophisticated drug smuggling operation, exporting over half a tonne of cocaine to Australia.

The National Crime Agency (NCA) uncovered their scheme, which involved using a front company to conceal the illicit drugs within metal toolboxes shipped via commercial flights. The seized cocaine, valued at £57 million, underscored the scale of their criminal enterprise.

With the illegal proceedings the couple, amongst other things, laundered the money gained through the purchase of a property worth £800,000. This was despite only having a few thousand declared to HMRC in earnings.

Law firms and especially conveyancers continue to face heightened pressure to enhance their anti-money laundering (AML) measures and mitigate risks associated with fraudulent activities.

Spot risky clients early on.

Confirming the income of a client through intelligent verification tools is becoming paramount for all and being able to spot the risky clients early on in a transaction can really help mitigate the risk.

In a case like this, being able to evidence the fact that the client income did not match the purchase price would likely have raised a red flag and identified inconsistencies.

Income Insights empowers firms to dissect transactional data, offering a comprehensive overview of clients’ income streams in intuitive visual formats.

With this tool, law firms can gain deeper insights into clients’ financial profiles, facilitating more informed decision-making and enhanced due diligence procedures.

Tom Lyes, Head of Legal at Armalytix, emphasises the critical role of these tools in the current regulatory landscape.

‘With regulatory scrutiny intensifying, law firms must deploy robust measures to identify and prevent fraudulent activities effectively. Our sophisticated Income tool plays a vital role in helping you better understand your clients.’

By The Armalytix Team — 13 February 24

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