FinCEN Issues Advisory on Venezuelan Attempts to Evade Sanctions
The Treasury’s Financial Crimes and Enforcement Network issued an update to its advisory on Venezuelan attempts to “steal, hide or launder money” in the wake of U.S.-imposed sanctions, FinCEN said in a May 3 press release. The 15-page advisory -- described as a guide for “chief risk officers,” chief compliance officers,” “sanctions analysts” and “legal departments,” among others -- provides an overview of U.S. sanctions against Venezuela and details the country’s attempts to avoid them. The guide also provides “financial red flags” to help companies report “suspicious activity that may be indicative of corruption by Venezuelan senior political figures.”
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The advisory said Venezuelan officials are using “TBML,” or trade-based money laundering, schemes to “evade sanctions and facilitate the movement and laundering of proceeds related to corruption, fraud, and embezzlement.” The Venezuelan government uses “international wire transfers, overinvoicing methods” and “front and shell companies across multiple international jurisdictions” to transfer funds into personal accounts. The advisory warns companies not to complete transactions involving government contracts that are “directed to personal accounts” or to “companies that operate in an unrelated line of business.” Other red flags are transactions involving “high-value assets” such as aircraft or real estate not “commensurate with the official salaries” of the senior government officials making the purchases.
“The international financial community must be vigilant to prevent exploitation by corrupt regime insiders and their enablers, including front companies and foreign financial institutions that continue to prop up this illegitimate regime,” Sigal Mandelker, undersecretary of the Treasury for Terrorism and Financial Intelligence, said in a statement.