12 February 2022, Rotterdam, Holland. Aerial view of Moscow Maersk Copenhagen. A large containership arrives in harbor Maasvlakte Rotterdam with a tug boat.

Trade-Based Money Laundering

If you do business internationally, make sure you do not become involved in Trade-Based Money Laundering (TBML) unnoticed. This form of money laundering is an increasingly common problem, with criminals laundering money through international trade transactions. Read below how to assess whether there is a risk of being used for criminal money laundering.

What can you do yourself?

Always use common sense and pay close attention if a transaction proceeds differently from what you are used to or expect. For example, do the following checks:

Does your buyer pay you through an unknown, third party or are you sometimes paid in cash? Be alert and ask for the reason. Is your trading partner really located at the address given? Check online what you can find about this company. Do the invoices match the agreements made? Check the amounts, quantities, descriptions and names on the invoice. Which country did the money come from and does it match your trading partner's country of establishment? Always check your account to see where the money is coming from.

Avoid getting involved in TBML

For example, do you recognize the following characteristics of your trading country? If so, the risk of TBML is higher than average.

A weak government and/or a lot of corruption
In countries with weak governance, low transparency and/or high levels of corruption, money laundering is more common. The Corruption Perceptions Index ranks 180 countries and territories based on perceived levels of corruption in the public sector.
Tax evasion and avoidance
The European Parliament's list shows in which countries there is an increased risk of tax avoidance and evasion.
Involvement in the 'Russian Laundromat'
This is TBML's biggest case to date. In the 'Russian Laundromat' case, banks and companies from the following countries are relatively common: China, Cyprus, Estonia, Latvia, Lithuania, Moldova, Russia, United Arab Emirates, Switzerland.

If you furthermore recognize the following characteristics of the sectors you trade in, the risk of TBML is higher than average.

Trade in natural resources, such as oil, gas, minerals and timber
These commodities are traded in high volumes, and have a high value and highly complex trading transactions. They often come from countries with an increased risk of corruption.
Wide price margins and extreme price variability
The value of the following goods may be deliberately misstated:
  1. High-value goods such as art, cars, yachts, designer items and jewelry. These may be unfairly undervalued.
  2. Low-value goods, such as second-hand textiles and scrap metal. These may be unfairly overvalued.
  3. Goods both over- and undervalued, such as electronics, auto parts and vehicles.

Mitigating risks together

Under the Financial Supervision Act (Wft) and the Prevention of Money-Laundering and Terrorist Financing Act (Wwft), Rabobank is tasked with detecting and combating financial crime. We also want to protect our customers from being harmed by inadvertent involvement in TBML activities. Do you have any doubts or questions? If so, contact your adviser or our customer service team.