New Payment Methods and Money Laundering

Calling cards, cell phones and internet payments. Should financial authorities redesign strategies to combat organized crime and its profits?

Wednesday, June 27, 2012

Ramon Garcia Gibson, an expert on the prevention of money laundering and terrorist financing, points out the slowness of adapting, when it is done, the rules and administrative and police procedures to the vertiginous changes in technology, in this case in payments methods available to the public.

Calling cards, cell phones and online payments, which are a great advantage for trade and even controlling personal finances have become tools for criminals to launder money.

"According to various sources it is estimated that annually around 40.000 million from the sale of the drugs crosses from the U.S. to Mexico, some of which is transported as contraband across the border by people with cash in their vehicles or attached to their bodies, using prepaid cards or electronic transfers.

Many of us have completed the classic customs form when entering a country where we you are asked if you bring $10.000 or more in cash to declare so, what do offenders think when they fill out this form knowing that they are bringing much more than that in prepaid cards that are legally exempt from reporting? Do they have a good laugh at this control that is so easy to evade? Without a doubt prepaid cards are just the start of the concerns for authorities over new payment methods. Cell phones and online payment schemes are the new frontier. "

More on this topic

Mobile Banking Project in El Salvador

June 2014

The draft law stipulates a maximum of $242 per movement and a cumulative amount up to $970 per month in transactions made via mobile devices.

The proposal by the Central Reserve Bank (BCR) seeks to "... regulate transactions through mobile devices. This financial service, to date, is only offered by Tigo Money for Tigo telephone customers."

Shopping Done Using Cell Phones

November 2013

Devices connected to the internet will revolutionize consumption not only in terms of the way things are bought but also in the interaction between consumers and retailers.

From an article by the Costa Rican Foreign Trade Promotion Office (PROCOMER):

Mobile devices continue to change buying habits and defining the profile of the online shopper was the topic of discussion at Mobile Commerce Congress, the first conference dedicated exclusively to mobile commerce as a new sales tool for retailers, conducted in Spain.

Nicaragua: Prepaid Cards on Mass Transit

February 2013

With an investment of $6 million, a card payment systems will be installed on buses, with operations starting in April.

The system aims to prevent drivers having to carry cash, as passengers will only be able to use the service through prepaid cards.

Ruben Altamirano, vice president of the Regional Union of Collective Transport Cooperatives (Urecootraco) noted that "carriers will not invest money in the installation of equipment or issuing the cards, but rather companies interested in the business will do so.

Payments Facilitated for Internet Sales

April 2012

The National Bank of Costa Rica has announced an agreement with PayPal so that their corporate clients can receive payments in their accounts from online sales.

The Banco Nacional (BN) and the online payment firm Pay Pal will announce today, Thursday April 26th, an alliance to facilitate online sales, customers can pay using an internationally recognized system and companies can receive money easily.

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