Money Services Business

Provides alternative remittance rails (e.g., online remittance, FX) that bots use to fragment and forward funds across borders outside the banking sector.

Unregistered or lightly regulated MSBs move funds internationally following the casino phase. They process remittances or currency exchanges with minimal oversight, widening the gap between illicit proceeds and final recipients, making it harder for financial institutions to detect money laundering.

Money services businesses enable the rapid movement of funds linked to illegal commodity sales.

• Multiple small transfers (structuring) may be used to bypass automated thresholds and reduce detection.
• Cash-based operations pose difficulties for financial institutions attempting to trace the source of funds.

MSBs providing currency exchange or check-cashing services can be infiltrated by counterfeit currency:

• Criminals exchange forged notes for legitimate currency or alternative payment forms.
• If verification protocols are weak, fake bills bypass detection and enter financial institutions downstream.

Money services businesses may be knowingly or unknowingly exploited as cross-border conduits by:

• Acting as local or regional sub-agents that process multiple low-value transfers below threshold reporting.
• Providing alternative channels, such as mobile or informal remittances, which fragment transaction trails across jurisdictions.
• Handling funds in ways that appear routine to financial institutions, complicating efforts to spot suspicious patterns or trace beneficial ownership.

• Criminals exploit Money Service Businesses (MSBs) to convert or transfer large amounts of smuggled cash.
• Weak Anti-Money Laundering (AML) controls in some MSBs enable the rapid integration of illicit funds into the financial system, evading detection by financial institutions.

Criminals exploit money services businesses by presenting official customs declarations as supposed proof of lawful origin for the cash. These businesses:

• Convert declared currency into other currencies or instruments without suspecting its illicit source.
• Process multiple smaller exchanges or transfers, allowing perpetrators to avoid triggering threshold-based reporting.
• Rely on the legitimacy conferred by official declarations, inadvertently facilitating the entry of illicit funds into the financial system.

Money services businesses, including both licensed and informal (unlicensed) currency exchange operators, are exploited by:

• Facilitating multiple currency swaps with minimal scrutiny or recordkeeping.
• Allowing complicit staff or ownership to overlook suspicious transactions or fail to file threshold reports.

By enabling frequent denomination changes and fragmented transaction records, these businesses significantly hinder effective tracing of illicit proceeds.

Money services businesses are exploited by:

• Processing remittance transactions that appear to be personal or philanthropic in nature but exceed typical amounts or lack a genuine family or organizational link.
• Relying on documentation (e.g., gift letters) that can be easily falsified, making it harder to identify suspicious transactions, especially in cross-border contexts.

Money services businesses are unknowingly exploited by criminals to:

• Rapidly transfer funds under multiple names or accounts.
• Circumvent certain due diligence measures by using structured deposits or withdrawals.

This enables fraudsters to move newly generated illicit proceeds under seemingly legitimate remittance or exchange transactions.

Some money services businesses knowingly supply large-denomination notes to criminals by:

• Exchanging smaller bills for high-value denominations (e.g., €500 notes), thereby reducing the physical volume of illicit cash.
• Processing these transactions with minimal scrutiny, enabling criminals to move concentrated currency undetected across borders.

This circumvents typical bank-level monitoring and creates gaps in reporting requirements for financial institutions.

Money services businesses (including bureaux de change) facilitate the layering of stolen government funds by:

• Exchanging local currency into foreign denominations and vice versa.
• Executing high-volume or repeated transactions that sidestep traditional banking channels.

These tactics obstruct oversight and complicate AML monitoring at financial institutions.

Money services businesses, including both licensed and unlicensed currency exchange offices, facilitate multi-currency swaps by enabling frequent foreign exchange transactions. Criminals exploit these services to disperse illicit funds across different denominations, sometimes in collusion with complicit operators who overlook suspicious transaction patterns. These rapid conversions hinder financial institutions' ability to track or identify the true origin of the assets.

Money services businesses are frequently exploited, knowingly or unknowingly, for multiple currency conversions. Criminals:

• Deposit or exchange small amounts at various MSB locations, often below reporting thresholds, to layer illicit proceeds.
• Exploit MSBs with weaker AML oversight or complicit staff to carry out repeated cross-currency transactions.
• Create downstream challenges for financial institutions, as these layered funds appear to arise from ordinary MSB operations.

Check-cashing outlets and similar MSBs unwittingly facilitate payroll tax evasion by:

• Cashing large volumes of payroll checks for employees of shell or front companies, bypassing typical bank scrutiny.
• Handling repeated transactions under multiple business or employee names, hiding the true size of the workforce or wage base.
• Offering rapid liquidity to funds that were never subjected to proper tax withholdings, complicating subsequent tracing efforts by authorities.

Money services businesses, including currency exchange and remittance providers, can be used to move funds internationally without triggering standard banking oversight. This activity allows sanctioned parties to evade detection, challenging financial institutions' ability to track and block illicit flows.

Unlicensed or unregistered money services businesses facilitate this technique by:

• Handling remittance, currency exchange, or virtual asset transactions without regulatory oversight.
• Accepting and dispersing cash or value across jurisdictions on behalf of criminal clients, bypassing AML reporting thresholds.
• Covertly operating within retail shops, import-export companies, or other front businesses to mask their true nature from financial institutions.