Money launderers get creative, use gift cards
Jeannine Aversa Associated Press Jan. 12, 2006 12:00 AM
WASHINGTON - Gift cards from stores and malls, phone cards and other prepaid cards are emerging as ways for criminals to launder money they have gotten through illegal activities.
Those were among the findings in a federal report released Wednesday that examined how criminals conceal and move dirty lucre.
As drug lords, terrorist financiers and other money launderers have found it increasingly difficult to move money through the United States' traditional banking system, they have been on the lookout for alternative means to move money, federal officials said.
Prepaid cards, which law enforcement officials call "stored value" cards, "are an emerging cash alternative for both legitimate consumers and money launderers alike," the report said.
The cards "provide a compact, easily transportable and potentially anonymous way" to store and access cash, it said.
The report also found that money-services businesses - such as check cashers, firms that wire money, and currency exchangers - in Arizona, California, Texas and New York, were the top filers of suspicious financial activity reports to the government from 2002 to 2004.
"These numbers indicate a concentration of illicit financial activity in major, densely populated cities and along the Southwest border," the report said. Mexico was identified as the primary destination for suspicious funds sent through money-services businesses.