THERE are over 400,000 suspicious transactions executed each year in Jamaica, according to financial investigators.
The daunting figure has prompted the police to implement an application that analyses reports of such activity within a couple of months.
The Financial Investigations Division (FID) plans to use GoAML — software run by the United Nations Office on Drugs and Crime (UNODC) — to process data received from financial institutions, according to Justin Felice, chief technical director at the FID.
"It will help us to effectively analyse the reports that provide the basis for investigations into money laundering" he said.
Jamaica will be the first country in the Caribbean and Central America to use the software, which is already being used by 20 countries worldwide.
At the same time, a former United States prosecutor urged the banking industry to report all suspicious transactions.
That way investigators will have more resources to uncover money laundering, says Robert O'Neill, the former US attorney who is now the managing director of Freeh Group International Solutions, a global risk management firm.
Despite the fact that each banker may interpret a transaction as suspicious when it is in fact legitimate, O'Neill figures that any transaction that seems suspicious must be reported.
"If you suspect something isn't right, you should report it," he said. "Documents are everything, somewhere in the documents will show there's a lie, it will have the point of origination to where the money is going."
Effective investigation into money laundering requires a collaborative effort among sovereign nations, continued reporting of suspicious transactions and investigators who dig deep into the reports that are made, he reckoned.
The investigations may take long due to the process it takes to obtain the records and individuals using their power and wealth to stop the process.
"When people have all the trappings of wealth and the good lawyers and accountants, they find a way to slow down the process," he said.
And while O'Neill lauded the effectiveness of the Mutual Legal Assistance Treaty, which allows the sharing of information among countries, he said it takes too long.
"It's effective, but it takes too long to get the information that is needed by each country," said O'Neill. "In most cases people have different things on their agenda so things don't happen quite as quickly."
Still, publicity on money laundering and financial terrorism cases have led to people being more knowledgeable and exercising better care in how they invest their money.
"The press has done a good job and when you hear these cases sometimes it's laughable, but the message is being sent," he said.
Until the authorities find a way to speed up the investigations, people should continue to be wary and look out for the red flags, O'Neill told participants at the Second Annual Anti-Money Laundering/Counter Financing of Terrorism Conference put on by the Jamaica Bankers Association (JBA) in collaboration with the Jamaica Institute of Financial Services (JIFS).
High investment returns with little or no risk, overly consistent returns, difficulty in receiving payments are clear indicators that you are investing in a Ponzi scheme, he said.
"Be suspect of an investment that continues to generate regular, positive returns regardless of overall market conditions," said O'Neill.
In many Ponzi schemes, the fraudsters focus on attracting new money in order to make promised payments to early-stage investors to use for their personal expenses instead of engaging in legitimate investment opportunities.
"The hallmark of the Ponzi scheme is that you use money form new investors to pay off old investors, " said O'Neill.