A Guide on Financial Crime Prevention in Trade Finance
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Book 1
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Book 1
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A Guide on Financial Crime Prevention in Trade Finance

A Guide on Financial Crime Prevention in Trade Finance


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About the Book

What is it that makes trade finance a particular target for criminals? The very nature and complexity of trade finance transactions, and the huge volume of trade flows that exist, can hide financial crime transactions and help criminal organisations to transfer value across borders. A Guide on Financial Crime Prevention in Trade Finance covers the various aspects of financial crime in relation to trade finance, and it outlines the various areas targeted for criminal activities in financial crime and the associated risks. Drawing on the experience of recognised experts in the trade finance sector, the report provides practical guidance on the specific financial crime risks in trade finance and it offers advice on the preventative measures that can be taken. Key features include: In-depth guidance from experts at Dentons, the ICC, Reed Smith LLP and Sumitomo Mitsui Banking Corporation (SMBC) Advice on integrating compliance into successful trade finance A review of the specific risks and examples of fraud involving the use of trade and commodity finance Detailed guidance on the money laundering and terrorism financing activities that are attempted through trade finance, with advice on preventative measures against them An assessment of the impact and practical application of sanctions in trade finance, with guidance on what trade finance firms can do to protect themselves

Table of Contents:
Chapter 1 provides the background information on financial crime in relation to trade finance. It outlines the vulnerabilities of trade finance to criminals and the need for stringent efforts to combat financial crime. The chapter provides detailed information on the latest global trade finance data and the wider danger to the global economy of too much de-risking in the global financial marketplace. Chapter 2 moves on to discuss the proper integration of compliance into successful trade finance. It provides in-depth advice on categorising trade finance and developing a risk appetite, and important guidance on the allocation of responsibilities to deal with financial crime risks. The chapter includes information on building the architecture of a sound and business-friendly financial crime risk strategy within an organisation, with detailed advice on: risk assessments; policies and procedures; due diligence; governance; and training and awareness. Fraud in trade finance is the focus of Chapter 3. This section of the report reviews the specific risks and examples of fraud involving the use of trade and commodity finance instruments. It identifies how vulnerable banks can be to fraud when loans are secured on commodities and references the Quingdao Port scandal, and it suggests some practical approaches to fraud prevention. Included in the chapter is a detailed explanation of the principles of a letter of credit and the fraud exception rule. Chapter 4 tackles the topic of money laundering, with a specific focus on the offences and obligations relevant to the trade finance sector. The chapter explores the methods of money laundering used in the trade finance world, and provides expert advice on the preventive measures which can be taken to counter money laundering in trade finance. Terrorism financing is another area of financial crime related to trade finance, and this is covered in Chapter 5. This chapter outlines the terrorism financing offences related to trade finance and the obligations relevant to the trade finance sector. It provides examples of terrorism financing through trade and the requisite measures to prevent such activities. Chapter 6 covers sanctions concerns in trade finance, and it explains what sanctions may be relevant in the trade finance sector in particular jurisdictions. It assesses the impact and practical application of sanctions and considers what trade finance firms can do to protect themselves. The chapter also provides a checklist of activities which are key to any sanctions compliance and protection programme. The report is aimed at a broad spectrum of individuals and organisations involved in different components of the cross-border trade transaction chain. Specifically, the report will prove helpful to those involved in the financing of trade - although exporters and importers will also find it a useful guide. The readership therefore comprises: trade bankers, compliance officers, corporate treasurers/CFOs of commodities companies, and other exporters and importers, vendors, consultants, and legal advisers. Regulators will also find it useful as a barometer of how their requirements are being interpreted and put into practice.


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Product Details
  • ISBN-13: 9781783581696
  • Binding: Paperback
  • ISBN-10: 1783581697
  • No of Pages: 86


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