It s s in the Data
Example Juan Lopez Date Sent Date Paid Amount Payee Sender 01/28/05 01/29/05 $2,150.00 JUAN\LOPEZ JAIME JIMENEZ TINOCO 01/29/05 01/29/05 $500.00 JUAN\LOPEZ BENITO SISNERO NIETO 01/29/05 01/30/05 $2,150.00 JUAN\LOPEZ RAFAEL CRUZ 01/30/05 01/31/05 $2,150.00 JUAN\LOPEZ ALEJANDRO DIAZ 01/30/05 01/31/05 $2,150.00 JUAN\LOPEZ ALEJANDRO DIAZ 01/30/05 01/31/05 $2,150.00 JUAN\LOPEZ RITA DIAZ 01/31/05 02/01/05 $1,800.00 JUAN\LOPEZ ALFONSO PADILLA 04/05/05 04/06/05 $1,850.00 JUAN\LOPEZ JAVIER BARBA 02/01/05 02/02/05 $2,100.00 JUAN\LOPEZ RAUL PRECIADO 02/10/05 02/10/05 $2,150.00 JUAN\LOPEZ JOSE A GARCIA 02/12/05 02/12/05 $2,150.00 JUAN\LOPEZ ARTURO MENDEZ 02/12/05 02/12/05 $2,150.00 JUAN\LOPEZ GUADALUPE DIAZ That s $23,450 in 15 days but what makes that suspicious?
Placed Into Perspective The frequency of transactions and the amount of each send is seven times the average for a regular user of a money transfer service An individual in the State of California that paid all applicable taxes would have to make approximately $1 million a year to net this amount There were three others using the same address and the address was in a low per capita income area.
Other Criminal Activity Structuring Date Payee Name PayCity ID Place of Issue Sender Name Sender City Sender State Amount 01/04/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $10,000.00 01/04/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $10,000.00 01/06/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $10,000.00 01/10/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $10,000.00 01/10/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $10,000.00 03/22/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $9,900.00 03/23/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $9,900.00 03/24/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $9,900.00 03/25/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $9,900.00 03/28/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $9,900.00 03/29/05 M MAN LODZ POLAND W SKI SAN FRANCISCO $9,900.00
Other Criminal Activity Canadian Lottery Date Pay Name Payee City Pay St Pay Count ry Send Name Send City SendSt Amount 04/16/05 JANE DOE MTL PQ NADA VICTIM 1 LA QUINTA $2,800.00 04/17/05 JANE DOE MONTREAL QC NADA VICTIM 1 LA QUINTA $2,800.00 04/18/05 JANE DOE LAVAL PQ NADA VICTIM 1 LA QUINTA $2,800.00 04/15/05 JANE DOE LAVAL PQ NADA VICTIM 1 LA QUINTA $2,800.00 06/30/05 JOHN DOE MIRABEL PQ NADA VICTIM 1 LA QUINTA $2,800.00 06/22/05 JOHN DOE MONTREAL QC NADA VICTIM 1 LA QUINTA $2,000.00 06/18/05 JANE DOE PIERREFONDS QC NADA VICTIM 1 LA QUINTA $2,000.00 06/17/05 JOHN DOE CHOMEDEY QC NADA VICTIM 1 LA QUINTA $2,000.00 07/01/05 JOHN DOE COTE ST LUC QC NADA VICTIM 1 LA QUINTA $2,800.00 06/03/05 JOHN DOE MONTREAL PQ NADA VICTIM 2 HEMET $1,000.00 05/24/05 JOHN DOE MONTREAL QC NADA VICTIM 2 HEMET $2,500.00 05/25/05 JOHN DOE MONTREAL QC NADA VICTIM 2 HEMET $2,850.00 05/26/05 JOHN DOE LAVAL QC NADA VICTIM 2 HEMET $2,650.00 05/31/05 JOHN DOE MONTREAL QC NADA VICTIM 2 HEMET $1,800.00 06/06/05 JOHN DOE MONTREAL QC NADA VICTIM 2 HEMET $2,500.00 06/09/05 JOHN DOE LASALLE QC NADA VICTIM 2 HEMET $1,500.00 05/27/05 JOHN DOE MONTREAL QC NADA VICTIM 2 HEMET $2,050.00
Arizona, has a unique situation relating to money transmissions Laws were created and strengthened to assist law enforcement in identifying criminal activity / money laundering using money transmitter services Regulatory oversight was increased
Arizona s s portion of the annual flow of undocumented aliens (UDA( UDA s) ) is estimated at 3,000 to 4,000 per day. 95% of Arizona UDA s use a smuggler (coyote) Each UDA pays the coyote an average of $1,600 to $1,800 3,000 X 95% X $1,600 = $1.7 Billion/yr 4,000 X 95% X $1,800 = $2.5 Billion/yr
Traditional AML transaction review criteria doesn t t always address the smaller transactions that are involved in potential illegal activity Lower Lower state threshold for id requirement causes a need to watch for structuring at a much lower level than traditionally looked for.
Transaction Review Same Same sender / receiver combination Same Same receiver / many different senders Same Same phone number / different persons Same Same address / different persons Same Same SSN used by different persons
Five Year Trends $2 Billion Illegal immigration market draws gold rush of hard core coyotes and facilitators to Northern Sonora, with Phoenix as the US transportation hub Coyotes have criminal backgrounds in other crimes, such as drug smuggling, so they form multi-crime enterprises Coyote activity is transitioning into hard- core organized crime. Money draws businesses into facilitation Siphon effect: UDA s have money to send, so UDA market accelerates itself.
SOURCE AREA FOR ILLEGAL GOODS AND SERVICES
$ COLLECTION POINT FOR PAYMENTS
LE Goals and Objectives Reduce crime associated with drug dealers and undocumented alien (UDA) smuggling by: Arresting and prosecuting key drug dealers & coyotes. Financially crippling smuggling organizations through civil racketeering remedies. Denying coyote and drug organizations the use of key facilitators
Regulatory Objectives Ensure Ensure compliance with statutes / rules Identify Identify suspicious or illegal activity
INTRODUCTION Corporate compliance departments as well as law enforcement face a number of problems when attempting to analyze data. There is no lack of available data. In fact, the data available to corporate compliance departments and law enforcement is overwhelming, it is just a matter of what to do with it and how to turn it into usable information.
SAMPLES OF ANALYTIL MARKERS FROM MONEY REMITTER DATA IN ARIZONA Repetitive receiver names in Arizona or Sonora Repetitive dollar amounts, payee addresses and phones High volume sending states (out of balance ratios) High volume payout agents Payee simultaneous use of Mexican forms of ID and U.S. Social Security numbers
How to find a coyote in data? Over Over 3 sends >$500 in a 30 day period From From 30 corridor states Sends Sends are person to person (not business) Usually Usually even dollars, no cents From From different states and people Amounts Amounts aggregate to at least $2,500
AGENT Receiver Name Wires Received Spelling Variations Total $ Received BOR MIRNA 176 36 $269,439 BOR EUSTAQUIA 87 17 $126,700 BOR MARIA TRINIDAD 78 25 $112,620 BOR PETRA 79 17 $109,657 BOR MINERVA 53 19 $96,700 BOR JESUS M 55 25 $87,414 BOR MARLEN 42 20 $49,500 BOR MARIA TRINIDAD 36 9 $49,400 BOR MARCO A 48 20 $43,200
MONEY TRANSFERS FROM CORRIDOR STATES PAID IN AZ States CT DE FL GA MD NC NJ NY SC VA 1/1/2005 through 11/15/2005 30X1 60X1 21X1 25X1 22x1 35x1 31X1 20x1 38x1 24x1 1/15/2005 through 4/15/2005 41 x 1 117 x 1 32 x 1 38 x 1 36 x 1 51 x 1 50 x 1 27 x 1 70 x 1 27 x 1
Before law enforcement and regulatory pressure were increased there were 36 Agent locations (less than 3.2% of total) that were paying out over 60% of all wires in the amount of $500 + coming into Arizona
Drug Smuggling in MT Data Sends Sends to Phoenix and Tucson from smuggling corridor states such as New York, Florida and Chicago. Same Same people sending and receiving Dollars Dollars used to be large (just under $3,000), now maintenance payments ($500). Smugglers have several clients & vice versa
Drug Smuggling Cecil Hawkins in 2002 Money Transmitter Database Spreadsheet for March 20-31, 2002 Cecil had over 300 transactions and received over $800,000 in 6 months in 2002 under the same Receiver Name Send Date Amount Sender Name S City S Phone Receiver Name P City 5/20/02 12:20 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/20/02 12:20 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/20/02 12:30 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/20/02 12:40 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/20/02 1:00 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/20/02 1:20 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/20/02 5:10 PM $2,650.00 HOWARD MPBELL BRONX (718)456-2040 CECIL HAWKINS TUCSON 5/20/02 10:30 PM $2,626.00 STACY DONNALDSON BRONX (718)484-9486 CECIL HAWKINS TUCSON 5/21/02 12:10 AM $2,600.00 ENNYS DICKS BRONX (718)151-2545 CECIL HAWKINS TUCSON 5/21/02 3:40 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/21/02 3:40 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/21/02 3:50 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/21/02 4:00 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/22/02 4:50 PM $2,700.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/22/02 4:50 PM $2,600.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/22/02 5:00 PM $2,700.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/23/02 4:00 PM $2,000.00 FIONA HAWKINS BRIDGEPORT (203)263-3600 CECIL HAWKINS TUCSON 5/24/02 6:40 PM $2,000.00 YVETTE HAWINS BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/27/02 5:10 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/27/02 5:20 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/28/02 1:30 PM $2,600.00 HOWARD SHERDDAN BRONX (718)645-3245 CECIL HAWKINS TUCSON 5/28/02 2:00 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/28/02 2:00 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/28/02 2:10 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/28/02 3:10 PM $2,600.00 ENNYS DONALDSON BRONX (817)324-0043 CECIL HAWKINS TUCSON 5/29/02 2:30 PM $2,500.00 STACY DONNALDSON BRONX (817)848-3488 CECIL HAWKINS TUCSON 5/29/02 2:50 PM $1,800.00 NECRECIA BANKS BROOKLYN (817)142-2078 CECIL HAWKINS TUCSON 5/29/02 3:10 PM $2,600.00 STACY DONNALDSON BRONX (817)848-3888 CECIL HAWKINS TUCSON 5/29/02 4:50 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/29/02 4:50 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/29/02 5:20 PM $2,000.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/30/02 2:00 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/30/02 2:00 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/30/02 2:10 PM $2,900.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/31/02 3:16 PM $2,000.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/31/02 3:18 PM $2,500.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON 5/31/02 3:21 PM $2,000.00 YVETTE SMYTH BRONX (646)902-9182 CECIL HAWKINS TUCSON $98,476.00 For example purposes only. Names and phone numbers are changed.
Methamphetamine Smuggling between Arizona and Arkansas
Jamaican Drug Smuggling from New York to Tucson
Same Name Decline Number of People Receiving over $50,000 & $100,000 1200 1128 1000 800 787 Number of Receivers 600 468 Number of Receivers over $100,000 Number of Receivers over $50,000 400 200 226 233 28 22 0 18 1 1 2001 2002 2003 2004 2005 Year
120 100 80 60 40 20 0 Average Receive to Send Ratio for the Top 10 Agents Mar-05 Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Date Ratio
$ SONORA MEXICO IS NOW THE COLLECTION POINT FOR PAYMENTS
Money Now Sent to Sonora Mexico
Latest Trends Use of Large Banks checking accounts. Use of Stored Value cards Triangulation Send money to Mexico
Agent Issues Due Diligence Reasonable Background Train agent - more than just having them sign off on receiving compliance program / training. Follow-up Monitor Monitor transactions Out of the norm for your other agents? Send / receive ratios
Questions?