20201020 Seizures and confiscations and why you should challenge everything.

Tuesday, 20 October, 2020 – 06:31

Good morning. I seem to be having some difficulty working out how long a month is, as it seems that my last monthly newsletter was on 25th August. That’s as close to two months ago as no matter.

In that two months, much has happened in the world and a lot of it has a direct, or indirect, impact on the world of financial crime risk and compliance.

We’ve seen across the world a significant number of seizures at customs of an extraordinary array of items. Of course, there’s the usual cigarettes, real and counterfeit, and the same with alcohol. But there still seems little done to stem the flow of counterfeit goods except those relating to medical, or para-medical supplies such as facemasks and the like.

Some of the confiscated goods are real but attempts were made to evade taxes, some are poor quality but not technically illegally sub-standard because, often, standards are not documented or, even, lack precision.

The trade in wildlife and its parts is heavily in the news but captures at borders are not as common as one might imagine.

But the most impressive change is in relation to the capture of drugs and cash. Here, it’s not the small-time mules that raise interest but the bulk movements of both. You’ve got to be a bit simple to imagine that it’s going to be easy to carry almost GBP2 million in five suitcase into Dubai. But that’s what a woman whose luggage was identified as suspicious during scanning at London’s Heathrow airport. She is being charged with money laundering.

It is said that one reason that such seizures are becoming more common is because the volume of shipped goods is reducing and so they stand out more. But that’s not entirely so.. private shipments, i.e. not in cargo or by courier, feature heavily.

But there seems to be injustice, too. A woman travelling from Paris with an alligator-skin handbag arranged the necessary CITES certificate before leaving France. On arrival in Australia, the AUD14,000 bag was confiscated because she had not obtained a second CITES certificate relating to Australia. It was reported that the bag was to be destroyed.

That is patently silly.

Why has CITES not created a centralised, ideally blockchain-based, register that items can be recorded on and simply scanned on exit from and entry to countries? A durable tag can be attached at manufacturing stage or added later. Duplicate stickers could be applied to passports or their covers. It’s a very easy thing to do and it only needs to be done once and the register updated on transfer of ownership. The neat thing is that it could also be used to combat counterfeiting and the use of such items as tokens in money laundering.

So, readers at CITES and at the many customs departments who subscribe to this newsletter – why not do that?