Fighting money laundering and other illegal financial activities
A recent news article from The Straits Times has mentioned that, with the rising complexity and risk of money laundering and terror financing, authorities have been urged to come up with new guidelines to combat such illegal activities.
In the article, it cited ‘’a South Asian conglomerate laundered huge amounts of cash by using 10 subsidiaries to swiftly shift funds of no more than US$20 million (S$26.7 million) each time between the units. The subsidiaries — in South-east Asia, South Asia and the Middle East — used at least one Singapore bank account to channel the funds in 2016 through the complex web of inter-company transfers’’.
Apart from the layering illustration specified above, some legal entities are misusing their own legal identities ‘’ For example, lawyers and corporate service providers run the risk of setting up complex corporate structures to help criminals camouflage the true owners of tainted money’’.
In addition, fake documents are common in trade finance, ‘’In one case study, a bank had sought more information on one of its client’s oil trading counter-parties and found that the entity was selling toys and games, not oil, raising suspicions’’.
The above examples show that our world open economy is vulnerable to the risk of money laundering and other illegal financial activities, even though authorities are doing their best to counter such financial crimes.
The concept of centralization has been ingrained in our society for so long that it has allowed some bad actors to conduct financial crimes, camouflaging their presence, hiding cross-border transaction records discreetly, unknown from the government regulators. With technological advancement, it has heightened the difficulty level to crack down on all these financial crimes as cross-border payment, transaction, remittance as well as identity tracking have become more sophisticated.
The problem with money laundering has always been a pressing issue in our society. Individuals and business entities can become victims to such financial crimes due to risk of frauds, lost of personal data, privacy and security breached. Currently, there is no realistic solution that can counter these financial crimes.
Usechain is on a mission to developing the first mirror identity blockchain ecosystem, to present a real solution to counter against illegal financial activities. Its main features will be targeting on ‘’identity’’, ‘’security’’, ‘’privacy’’ these three different aspects, using Mirror Identity protocol integrating with multi-level innovative technology and structure design to provide transparent mapping records, at the same time protect privacy and ensure security.
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