State of Financial Crime 2023 Report

Online Influencer Andrew Tate, Detained on Human Trafficking Allegations

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On December 29, controversial online influencer Andrew Tate was detained by Romanian police as part of a human trafficking investigation that began in early 2021. According to Romania’s  Directorate for Investigating Organised Crime and Terrorism (DIICOT), Tate’s brother and two Romanian nationals are also under investigation for creating “an organized crime group with the purpose of recruiting, housing, and exploiting women by forcing them to create pornographic content meant to be seen on specialized websites for a cost.”

Before the arrest, the Bucharest Organized Crime Brigade initiated five home search warrants for properties belonging to the Tate brothers. Since then, Romanian police have seized 11 luxury cars and several buildings owned by the detainees, with investigators claiming they will be held as collateral for any payments required to be made to the alleged victims. 

DIICOT has confirmed that Tate will be detained for up to 30 days while the police continue investigating.

Human Trafficking and Rape Allegations

According to the DIICCOT press release, Tate and the three other suspects are being investigated for forming an organized crime group operating in Romania, the UK, and the USA. 

The allegations include Tate using British nationals to recruit victims by misrepresenting their intention to enter a marriage or cohabitation relationship. Commonly known as ‘the loverboy method,’ the victims were then transported and housed in buildings in Romania where they were sexually exploited by group members and forced to perform pornographic acts for social media distribution. Thus far, the police have identified six victims who experienced physical violence and mental coercion from the group.

Red Flags Indicators

According to the Financial Action Task Force (FATF), human trafficking is estimated to be one of the most profitable proceeds generating crimes in the world, with the International Labour Organisation (ILO) estimating that the business of forced labor globally generates $150.2 billion per year.

Because the financial flows from human trafficking are so diverse, detecting attempts to launder the proceeds can be challenging. Compliance teams should be aware of the following red-flag indicators that could point to human trafficking activity:

  • Large deposits that are immediately withdrawn in towns close to international borders
  • Patterns of card transactions in even amounts of money between 10pm and 6am 
  • Sudden deviations from expected customer account activity
  • Use of anonymous financial instruments to pay bills
  • Structured deposits across multiple physical banking locations
  • Multiple victims sharing bank account information, including a phone number or address

Key Takeaways

To prevent and mitigate the risk of human traffickers laundering money, compliance teams should consider the following best practices for customer screening and transaction monitoring: 

  • Contextual information: Many indicators of money laundering and human trafficking intersect with legitimate financial activities, making the crime challenging to identify. With this in mind, firms should consider indicators combined with as much contextual information as possible to create a more accurate determination.
  • Information sharing: When evaluating potential trafficking activity, compliance teams should seek to share information to establish a more accurate picture of suspected trafficking operations. Many legislative frameworks include information-sharing mechanisms allowing institutions to share information amongst themselves and regulators.
  • Customer Due Diligence: Firms should enhance their efforts to identify trafficking by optimizing their Customer Due Diligence (CDD) measures and other screening and monitoring processes. These processes should utilize all publicly available resources, including dynamic politically exposed persons and negative news screening.
  • Suspicious Activity Reports: When reporting human trafficking activity in a suspicious activity report (SAR), firms should understand how to help the authorities investigate traffickers by including key terms and information. 

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Originally published January 5, 2023, updated January 6, 2023

Disclaimer: This is for general information only. The information presented does not constitute legal advice. ComplyAdvantage accepts no responsibility for any information contained herein and disclaims and excludes any liability in respect of the contents or for action taken based on this information.

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