"It can't happen here" may help you sleep at night, but just because your bank doesn't do business in places like San Diego or New York City doesn't mean that it's not going on in your markets--and the proceeds potentially going through your bank.
"It" is human trafficking, which covers both smuggling illegal aliens into the U.S. and enslaving women and children for the sex trade and all people for forced labor.
Close to home, wherever home is
While many bankers may think of human trafficking as an issue in large cities, all size towns in all areas of the U.S. find this issue very close to home, warned Anna Rentschler, vice-president and BSA officer at Central Bancompany, during the Money Laundering Enforcement Conference sponsored late last year by ABA and the American Bar Association.
Rentschler, moderating a panel, told listeners about cases involving prostitution and worse in communities in the Midwest, arising through human trafficking. The region, being the crossroads of the nation, "is a 'wonderful' place to drop off people," said Rentschler. She noted that so much trafficking goes through the region that long-haul drivers have united through www.truckersagainsttrafficking.com to teach the warning signs of trafficking, and how truckers can intervene.
Victims come from our own cities and towns--runaways, for instance--as well as from overseas. Rentschler said that major natural disasters have left thousands destitute around the world, and some affected people become prey for importers of people--essentially modern-day slavers trading on their inability to support themselves or their families any other way.
Some victims are lured by faked romance, and held in hellish circumstances through fear. Debt bondage holds others, with debt for being smuggled into the U.S., or other purposes, keeping them enslaved. Often victims lack valid travel documents, and have had the faked ones used to bring them to the U.S. taken, so they have nowhere to flee.
Speaking of traffickers' means of disposing of their ill-gotten cash, Michael Tutko, section chief in Homeland Security Investigations' Human Smuggling and Trafficking Unit, warned bankers that their laundering methodologies were pretty standard. They go in for wire transfers and other "traditional methods," such as bulk cash smuggling.
"And if it isn't bulk cash smuggling, they'll do it through your bank or something like Western Union," said Tutko.
Bankers also heard from a JP Morgan Chase expert who discussed how his bank developed typologies that have helped the bank's investigators to identify traffickers and their victims.
Trafficking's grim trail
Human trafficking for the purpose of forced labor happens more frequently, measured by number of victims, than does trafficking for the sex industry, according to Tutko. The penalties for the latter are tougher than the former--asset forfeiture is frequently sought by the authorities and can be used to recompense victims. Forced-labor trafficking can bring imprisonment of up to ten years, whereas sex-trade trafficking sentences start at ten years--15 years if the victim was under 18 years old.
Perhaps the most tasteful way to summarize the crimes described or merely hinted at in regard to enslavement was used by Rentschler. Trafficking has become a big interest for the gangs, because you can only sell a quantity of drugs once, but sex slaves can be sold over and over again. The details provided by Tutko, even muted as they had been for presentation, were horrific.
When Tutko and fellow investigators break into houses used by traffickers, the scenes they find go beyond sordid. "The fear that's in these people's eyes ... ," said Tutko. "They are scared to death, and rightfully so." Frequently they have been beaten and wounded in order for their captors to keep them in line. …