BOGOTA – Colombia‘s financial crimes unit, intensifying efforts to catch fraud, has detected some $20 billion in financial operations potentially tied to money laundering over the last 3-1/2 years, the unit’s director said.
The figure is equivalent to more than 6% of Colombia‘s annual gross domestic product.
Money laundering occurs when funds earned from illegal activities like drug trafficking are invested in front businesses which integrate illicit money into the legitimate financial system.
The funds were detected through more than 20,000 suspicious activity reports flagged each year by the Financial Information and Analysis Unit (UIAF).
“In the last few years we’ve hit the accelerator and the learning curve in terms of interception of illicit funds,” UIAF director Javier Gutierrez told Reuters.
The $20 billion was detected between 2019 and mid-2022, he said.
The United Nations Office on Drugs and Crime estimates that 2% to 5% of the world’s GDP – between $800 billion and $2 trillion – is laundered annually, though by its nature money laundering is hard to trace.
Laundering can cause inflation and create unfair competition when front businesses offer products and services at artificially low prices.
The UIAf has found some 570 channels through which money is laundered – including fake or inflated invoices, currency trading, exports and crypto-currencies, Mr. Gutierrez said.
Colombia‘s penal code outlines 66 types of crimes tied to money laundering including drugs and arms trafficking, customs fraud and people smuggling.
The Andean country is a top producer of cocaine and home to rebel groups and crime gangs involved in drug trafficking, illegal mining and other crimes.
“In importance drug trafficking is the one that generates the most resources and corruption is second for the harm it does to public investment and social programs,” said Mr. Gutierrez.
Fighting money laundering is potentially more effective for combating crime than arrests, Mr. Gutierrez said.
“Being detected matters very little to criminals, it matters much more to be captured, but what hurts them most is the chance resources will be taken away,” said Mr. Gutierrez. “If you bankrupt them economically it is much harder for them to be resilient.” – Reuters