RiskTech Forum

Accuity: Managing a Growing Threat - Improving the Trade Finance Screening Process With Technology

Posted: 12 April 2017  |  Source: Accuity


Trade finance is a crucial artery for the world’s economy. The World Trade Organisation estimates that between 80 – 90% of global trade is reliant on the trade finance method of financing.

Rapid growth in the global economy, combined with the regulator’s ability to identify conventional money laundering techniques; like physical cash smuggling and bank transfers, has made international trade an increasingly attractive avenue to move illicit funds through financial transactions associated with the trade in goods and services.

Trade-based money laundering (TBML) is a complex phenomenon. Its constituent elements cut across not only sectoral boundaries but also national borders, and the dynamic environment of international trade allows it to take multiple forms.

The research group Global Financial Integrity (GFI) perhaps best highlighted the scale of the problem.

Their 2014 study of developing countries revealed that nearly 80% of illicit financial flows were due to false invoicing, which includes: under-invoicing, over-invoicing, and multiple invoicing – all common techniques employed in TBML. In March 2015, Accuity hosted a trade finance event in Hong Kong to address the core business challenges related to trade finance and anti-money laundering compliance. This high profile event, which featured speakers from KPMG and Accuity, was attended by over 200 industry experts from banks, corporates, and regulators.

This paper presents the insights gathered during the event, compares them with the Western world, and delineates the need for an effective solution that cuts through the increasingly convoluted trade finance landscape, in Asia and beyond.

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