1.

COMPARATIVE MODELS IN POLICING

Policing is one of the most important of the functions undertaken by every sovereign
government. For the state machinery, police are an inevitable organ which would ensure
maintenance of law and order, and also the first link in the criminal justice system. On the
other hand, for common man, police force is a symbol of brute force of authority and at the
same time, the protector from crime. Police men get a corporate identity from the uniform
they wear; the common man identifies, distinguishes and awes him on account of the same
uniform. The police systems across the world have developed on a socio cultural
background, and for this reason alone huge differences exist between these police systems.

Comparative Models and Policing is the science and art of investigating and comparing
the police model of nations. It covers the study of police organizations, trainings and
methods of policing of various nations.

While Comparative Criminal Justice is a subfield of the study of criminal justice that

compares justice systems worldwide. Such study can take a descriptive, historical, or political
approach. It studies the similarities and differences in structure, goals, punishment and
emphasis on rights as well as the history and political structure of different systems.

Furthermore, International Criminal Justice is the study and description of one country’s

law, criminal procedure, or justice process (Erika Fairchild). Comparative criminal justice
system attempts to build on the knowledge of criminal justice in one country by
investigating and evaluating, in terms of another country, culture or institution.

Comparative Research Methods

1. “Safari” Method (a researcher visits another country) or “collaborative” method (the

researcher communicates with a foreign researcher)
2.   Published works  tend to fall into two categories:
1. Single-culture studies  - the crime problem of a single foreign country is
discussed
2. Two-culture studies – comprehensive textbooks (it covers three or more
countries). The examination of crime and its control in the comparative context
often requires a historical perspective since the phenomena under study are
 seen as having developed under unique social, economic, and political
structures.
3. Historical- comparative method – the most often employed by researchers. It
is basically an alternative to both quantitative and qualitative research
methods that is sometimes called historiography or holism.

1. COMPARATIVE MODELS IN POLICING

1.1. Theories of Comparative Criminology

Theories of Comparative Criminology

1. Alertness to crime theory  – as a nation develops people’s alertness to crime is

heightened, so they report more crime to police and also demand the police become
more effective at solving crime problems.
2. Economic or Migration Theory  – crime is everywhere is the result of unrestrained
migration and overpopulation in urban areas such as ghettos and slums.
3. Opportunity Theory  – along with higher standards of living, victims become more
careless of their belongings, and opportunities for committing crime multiply.
4. Demographic Theory  – is based on the event of when a greater number of children
are being born, because as these baby booms grow up, delinquent subcultures develop
out of the adolescent identity crisis.
5. Deprivation Theory  – holds that progress comes along with rising expectations, and
people at the bottom develop unrealistic expectations, and people at the top don’t see
themselves rising fast enough.
6. Modernization Theory  – sees the problem as society becoming too complex.
7. Theory of Anomie and Synomie  (the latter being a term referring to social cohesion
on values), suggests that progressive lifestyle and norms result in the disintegration of
older norms that once held people together.

2. GLOBALIZATION

GLOBALIZATION

-             Is a package of transnational flows of people, production, investment, information,

ideas and authority

-             Describes an ongoing process by which regional economies, societies, and cultures
have become integrated through a globe-spanning network of communication and
exchange.

-             Globalization is a process of interaction and integration among the people,

companies, and governments of different nations, a process driven by international trade
and investment and aided by information technology. This process has effects on the
environment, on culture, on political systems, on economic development and prosperity,
and on human physical well-being in societies around the world.

Charles Taze Russell - who coined the term 'corporate giants' in 1897 early description for
globalization

SaskiaSassen - writes that "a good part of globalization consists of an enormous variety of
micro-processes that begin to denationalize what had been constructed as national —
whether policies, capital, political subjectivities, urban spaces, temporal frames, or any other
of a variety of dynamics and domains.

Tom G. Palmer - defines globalization as "the diminution or elimination of state-enforced

restrictions on exchanges across borders and the increasingly integrated and complex
global system of production and exchange that has emerged as a result.

Thomas L. Friedman - argues that globalized trade, outsourcing, supply-chaining, and

political forces have changed the world permanently, for both better and worse.

Takis Fotopoulos- argues that globalization is the result of systemic trends manifesting the
market economy’s grow-or-die dynamic, following the rapid expansion of transnational
corporations.

Measuring globalization

Four main economic flows that characterize globalization:

 Goods and services, e.g., exports plus imports as a proportion of national income or

per capita of population
 Labor/people, e.g., net migration rates; inward or outward migration flows, weighted
by population
 Capital, e.g., inward or outward direct investment as a proportion of national income
or per head of population
 Technology, e.g., international research & development flows; proportion of
populations (and rates of change thereof) using particular inventions (especially
'factor-neutral' technological advances such as the telephone, motorcar, broadband).

GLOBALIZATION AND LAW ENFORCEMENT

Every nation has its own law enforcement agency called the Police. One thing is common,
the police symbolize the presence of a civil body politics in everyday life; they symbolize the
capacity of the state to intervene and the concern of the state for the affairs of citizenry. It is
therefore timely to discuss the connection of globalization to policing.

EFFECTS OF GLOBALIZATION ON LAW ENFORCEMENT

      Every law enforcement agency in the world is expected to be the protector of the
people’s rights. Globalization has great impact on every human right.

      The emergence of an “international regime” for state security and protection of human
rights, growing transnational social movement networks, increasing consciousness and
information politics have the potential to address both traditional and emerging forms of
violations. Open international system should free individuals to pursue their rights, but large
numbers of people seem to be suffering from both long standing state repression and new
denials of rights linked to transnational forces like international terrorism and other acts
against humanity.

      The challenge of globalization is that unaccountable flows of migration and open
markets present new threats, which are not amenable to state-based human rights regimes,
while the new opportunities of global information and institutions are insufficiently
accessible and distorted by persistent state intervention.

Threats on Law Enforcement: Some threats brought about by globalization are:

1. Increasing volume of human rights violations evident by genocide or mass killing;

2. The underprivileged gain unfair access to global mechanisms on law enforcement
and security;
3. Conflict between nations;
4. Transnational criminal networks for drug trafficking, money laundering, terrorism.

Opportunities for Law Enforcement: While globalization brings the threats and many
other threats to law enforcement, opportunities like the following are carried:

1. Creation of International tribunals to deals with human rights problems

2. Humanitarian interventions that can promote universal norms and link them to the
enforcement power of states
3. Transnational professional network and cooperation against transnational crimes
4. Global groups for conflict monitoring and coalitions across transnational issues

CHALLENGES OF GLOBALIZATION IN THE FIELD OF LAW ENFORCEMENT

      In the law enforcement and security sphere, states respond with increased repression to
fragmentation, transnational civil war, and uncontrolled global flows such as migrants and
drug trafficking. Transborder ethnic differences help inspire civil conflict, while the global
arms trade provides its tools. Even extreme civil conflicts where states deteriorate into
warlordism are often financed if not abetted by foreign trade; diamonds in the Congo and
Sierra Leone, cocaine in Colombia. While non-state actors like insurgents and paramilitaries
pose increasing threats to human rights, state response is a crucial multiplier for the effect
on citizens. Since all but the most beleaguered states possess more resources and authority
than rebels, they can generally cause more damage and human rights monitoring in a wide
variety of settings from Rwanda to Haiti attributes the bulk of abuses to state (or state-
supported) forces. States also differ in their ability and will to provide protection from
insurgent terror campaigns.

      Global economic relationships can produce state policies that directly violate social and
labor rights and indirectly produce social conflict that leads to state violations of civil and
security rights. While globally induced economic adjustment may cut state services and
intensify poverty and protest, global windfalls of wealth may also underwrite repressive and
predatory states, as in Angola, where oil revenues have fueled repression and civil war. It
states that largely determine labor rights and security response to labor dissidence; states
also regulate multinationals, certify unions, and form joints ventures with global investors.

3. TRANSNATIONAL CRIMES

TRANSNATIONAL CRIMES

Transnational crime

-       refers to crime that takes place across national borders.

-       The word "transnational" describes crimes that are not only international (that is,
crimes that cross borders between countries), but crimes that by their nature involve border
crossings as an essential part of the criminal activity.

-       Transnational crimes also include crimes that take place in one country, but their
consequences significantly affect another country. Examples of transnational crimes include
the human trafficking, people smuggling, smuggling/trafficking of goods (such as arms
trafficking and drug trafficking), sex slavery, and (non-domestic) terrorism.

Transnational Organized Crime (TOC) refers specifically to transnational crime carried out by

organized crime organizations.

3. TRANSNATIONAL CRIMES
3.1. A. HUMAN TRAFFICKING

1. A.  HUMAN TRAFFICKING

 Human trafficking is commonly understood to evolve a variety of crimes and abuses associated
with the recruitment, movement and sale of people including body parts into a range of
exploitative conditions around the world.

Trafficking - the recruitment, transportation, transfer, harboring or receipt of person, of fraud, of

deception, of the abuse of power or of a position of vulnerability or of the giving or receiving of
payments or benefits to achieve the consent of a person having control over another person, for
the purpose of exploitation.

 Exploitation shall include, at a minimum, the exploitation of the prostitution of others or other
forms of sexual exploitation, forced labor or services, slavery or practices similar to slavery,
servitude of the removal of organs.

Smuggling - is the procurement, in order to obtain directly or indirectly, a financial or other
material benefit, of the illegal entry of a person into a state party of which the person is not a
national or a permanent resident.

 During the past decades, human smuggling across national borders grew from a low – level
border crossing activity in a handful of countries to a diverse multibillion dollar business
spanning the entire globe. It has historical parallels with the traffic and exploitation of black
Africans in previous centuries, when the colonial slave trade was considered not only on a lawful
but desirable branch of commerce by European empires.

TRAFFICKING IN PERSONS

 Trafficking in persons is a form of modern – day slavery.

 Trafficking organizations prey on individuals who are poor, often women who are lured with
false promises of good jobs and better lives and, instead, are forced to work under brutal
condition.
 International trafficking in women for the sex industry has been a characteristic of modern
international organized crime. 
 Many countries grant “artistic” or “entertainer” visas that facilitates the movement and
exploitation of trafficking victims. Women are granted these temporary visas upon presentation
of a work contract or offer of engagement by a club owner, proof of financial resources, or
medical test results. Employment agencies, licensed under the laws of the origin and destination
countries, play a key role in the deception and recruitment of these women. On arrival at their
destination, victims are stripped of their passports and travel documents and forced into
situations of sexual exploitation or bonded servitude. Having overstayed or otherwise violated
the terms of visa, victims are coerced by their exploiters with threats to turn them into
immigration authorities.

Human trafficking is a growing transnational criminal phenomenon – conservative estimates put

the total number of persons trafficked globally at two million per year. It started in the 1700’s
when child labor was first started. Children worked long and dangerous hours for little pay in
factories and coal mines.

Philippines

      In the area of human trafficking, the country, the Philippines continues to be a source,
transshipment point and destination for trafficked and smuggled persons mostly women and
children. Smuggling or trafficking incidents victimizing Filipinos are increasing due to
worsening push factors (e.g., poverty, unemployment), huge profits derived by human smuggling
syndicates, increasing and attractive opportunities in developed countries, and a rapid increase in
the number of “willing victims” who are desperate in improving their standards of living.
According to the National Commission on the Role of Filipino Women (NCRFW), an estimated
25,000 to 35,000 Filipino women are victims of trafficking, every year which already accounts
for 50% of all women victims of trafficking in Southeast Asia.

      Authorities have identified countries of destination as well as trafficking routes frequently
utilized by syndicates in moving their victims. These destination countries include the United
States, Canada, Italy, Japan, Jordan, South Korea, Singapore and even Malaysia. It was also
noted that several states specially those adjacent to the foregoing destination countries are
utilized as transshipment points to mislead Philippine immigration authorities.

      Several foreign nationals were also apprehended in different ports of entry for trying to use
the Philippines as a jump off point to their final destination. This was manifested by several
interdictions initiated by immigration and other law enforcement authorities. This includes the
arrest of Chinese nationals while trying to leave the Ninoy Aquino International Airport (NAIA)
bound for the United States or Canada. Eleven (11) Bangladesh nationals were also apprehended
in Southern Philippines as they prepared to leave for Japan aboard a cargo ship. Several Iranian
nationals en route to Japan were apprehended at the NAIA for entering the country using fake
European and pretending to be Spanish nationals.

      As the destination country, several foreigners’ mostly Indian nationals intending to do
business in the country were apprehended by Philippine authorities and were subsequently
deported for illegal entry. These incidents of illegal migration, smuggling and trafficking are
general trends in almost all developing countries such that there is a growing perception for
undocumented migration to become an issue of major conflict in the very near future.

Various conceptions of Trafficking:

1. 1.  Slavery – human trafficking as a contemporary form of slavery is marked out by legal

ownership of one human being by another or long-term enslavement, but by temporary
ownership, debt bondage, forced labor and hyper-exploitative contractual arrangement in the
global economy.

Main Forms of Slavery

a)  Bonded labor system and forced labor in sweatshops, private households and on forms not
only in poorer regions such as South Asia but also in Western Europe and the United States.

b)  Exploitation of children as laborers in cottage industries or quarries on the Indian,

subcontinent, as camel jockup in Gulf States or as soldiers in Africa.

c)  Servile marriage in South Asia and Muslim societies.

1. 2.  Prostitution - traffic women for commercial exploitation traced back about the “white slave”
trade of women and young girls into prostitution at the end of the nineteenth century.
2. 3.  Organized Crime – the trafficking-as-transnational organized crime approach has been
promised on two contrasting views of the relationship between the state and the trafficking
problem.
3. 4.  Migration – forced migratory movements in various regions, which in turn have been spurred
on by economic crisis, lack of sustainable livelihoods, political conflict, civil war, ethnic
persecution, social inequalities, gender – based macroeconomic policies and wider processes of
global social transformation. For many trapped in dire poverty, displaced by political turmoil,
and turned away by increasingly restrictive immigration and asylum policies termed as broad
zone of exclusion, migration through irregular channels of smuggling and trafficking has become
their only means of escape. The desire to escape from chronic economic and social crisis makes
many of the women highly vulnerable to trafficking harm.
4. 5.  Human rights – trafficking has been seen as a violation of basic human rights of a person
under the 1948 Universal Declaration of Human Rights, including the right to be free from
slavery or servitude; right to freedom of movement; right to life, liberty and security; right to
health; and right to free choice of employment.

Six Primary Reasons for Increasing International Flow of People

1. 1.  Geographic differences in supply and demand for labor which encourage decisions to move
and to make more money in the new host country.
2. Benefits of additional markets and other benefits in the target country.
3. Demands by developed countries for cheap labor.
4. Feedback: penetration of migration by existing networks of immigrant families in the host
countries and by organizations there which promote migration.
5. Environmental degradation, where the physical or agricultural environment in the home country
no longer proves acceptable.
6. Involuntary migration caused by civil war or oppression.

Human Trafficking as a Form of Transnational Crime

The Criminal Actor

      Traffickers are enormously diverse. They range from diplomats and employees of
multinational organizations who traffic a young, women for domestic labor to the large
organizations of Asia which specialize in human smuggling and trafficking. Women assume a
larger role of transnational crime as recruiters, madams and even kingpins of major smuggling
operations. This is the only aspect of transnational crime where women assume a leading role.
      Human smugglers and traffickers are not always exclusively motivated by profit. Some
consciously engage in this activity for fund a terrorist group, a guerilla movement or an
insurgency. A terrorist in prison in Europe ran a prostitution ring of trafficked women from
Maldova to fund Hezbollah.

Stages of Moving Migrants Illegally

1. 1.  Recruitment

Initial victimization of the trafficked person is usually by a member of her ethnic group. There
are many reasons that recruitment occurs within one’s own group. Proximity and access are
important. But equally important is trust. Trust is important because people often contract with
traffickers and smugglers to move them to a particular locale, to pay a certain amount of money
or to keep them in bondage for a particular period. Trust is more easily established with someone
from one’s ethnic, language or cultural group.

1. 2.  Transfer

Tourist and student visas may be used to enable entry, illegal entry may mean extraordinary
uncomfortable and dangerous journeys by road, sea and air; either crossing borders without
anyone’s knowledge or with the help of corrupt officials. Once the journey is completed, people
who have been smuggled will generally be abandoned and left to look after themselves; those
who are being trafficked will be taken to wherever they are to put to work.

1. 3.  Entrance

      There are a number of well-established routes, including a Baltic route that states in Asia,
passes through Baltic states ending in Scandinavia and an East Mediterranean route which runs
from Turkey to Italy, sometimes stopping in Greece or Albania in route.

      North America, Western Europe, parts of the Middle East and Australia are the common
destinations for people being trafficked. Latin America, parts of West Africa and Eastern Europe
are the most common sources of people being trafficked. A number of countries in the Far East,
including Thailand, China and Cambodia, rate highly as countries of both origin and destination
of human trafficking.

Methods of Smuggling and Trafficking

1. Amateur Traffickers – who are those that specialize in occasional, sometimes one-off jobs in
helping people cross borders and possibly find work.
2. Small groups of organized criminals – who specialized in leading people from one country to
another using recognized routes.
3. International trafficking networks – who provide a broad range of services including fake
documents, accommodations, employments, etc.
Techniques Used in Human Trafficking

1. 1.  The widely used techniques in Eastern Europe and the former Soviet Union – advertisements
and websites – are absent from the poorer countries of Asia, Africa and Latin America. All too
often, the victim is previously acquainted with his/her trafficker.

Trafficking victims are often recruited by people they know, friends, family, acquaintances and
sometimes boyfriends. Some men deliberately befriend vulnerable young women

1. 2.  Women, who have been trafficked into prostitution, often return to their home
communities with tales of their superior earnings. They talk to their friends and acquaintances
in to joining them by lying about the conditions of the work and the amount they derived from
their employment as prostitutes. These women get bonuses for recruiting or themselves move
into the position of brothel keepers enslaving the women they have recently trafficked.
2. 3.  Traffickers travel to rural areas of poor countries to recruit victims. This can be likely in the
north of Thailand, the mountainous communities of Nepal or the villages of Central Asia. The
traffickers will find the poorest families, those with problems of drug or alcohol abuse or serious
medical problems. They will assure the family that they can provide a better future for the child
and may offer some nominal payment in return.
3. 4.  Families may also be offered money directly for the child. This method had been used
successfully with alcoholics and drug addicts in Russia. Often impoverished families, with more
children than they support sell their children to traffickers to save other children through this
act.
4. 5.  Some cases of organ traffickers are motivated by the same sense of familial obligation. A
trafficker will locate a potential provider of a kidney that will be extracted in an operation
outside the seller’s home country. The money derived from the organ sale will be used to
support the starving family, to provide medical care for an ill relative or Soviet successor States,
children have been sold out of orphanages for adoption by the administrators. Organized crime
groups serve as the intermediaries between the parents and the adoption agency. Notaries
were bribed to certify that the parents have surrendered their parental rights.

      Many ploys are used to recruit victims, including advertisements and establishments of
marriage and employment agencies in the countries of origin. Web and newspapers
advertisements for matchmaking services and marriage bureaus may prove to be a cover for a
trafficking network. Newspapers carry advertisements for employment abroad as nannies, hotel
maids or providers for care for the elderly.

Factors that Help Account for Migrant Smuggling in the Modern World

1. 1.  “Push” or “supply” factors – those factors which create a sizeable population of people
looking to leave their own country and seek better circumstances elsewhere.

The existence of large number of impoverished and vulnerable people; political instability and
civil wars; the existence of weak states; religious and ethnic conflict as extreme as genocide in
some cases; and natural disasters.

1. 2.  “Pull” factors – which make foreign destinations attractive to migrants.

Availability of relatively well-paid work; welfare system; relative wealth and stable economies;
and political stability and security.

1. 3.  “Demand” factors – which underpin illegal trades.

Demand for cheap and vulnerable labor, and demand for embodied labor services – people at a
particular age, ethnic origin, in relation to their suitability for domestic labor; or more usually,
involvement in different aspects of the sex trade.

Division of Labor in Smuggling and Trafficking

1. 1.  Arranger/investors who direct and finance operations.

2. 2.  Recruiters who arrange customers.
3. 3.  Transporters who assist the movement of immigrants at departure and destination.
4. 4.  Corrupt officials including police/law enforcement officers who may obtain travel documents
or overlook illegal transit.
5. 5.  Informers who provide information on border controls and other factors.
6. 6.  Guide/crew members who help move migrants between specific points.
7. 7.  Supporting personnel and specialists who provide accommodation and other assistance.
8. 8.  Debt collectors who collect trafficking fees in the destination country.
9. 9.  Money movers who launder the proceeds of the transactions.

◄ Please read me!!!!

3. TRANSNATIONAL CRIMES

3.2. B. MONEY LAUNDERING

1. A.  MONEY LAUNDERING

 Money Laundering is the process whereby proceeds, reasonably believed to have

been derived from criminal activity, are transported, transferred, transformed,
converted, or intermingled with legitimate funds, for the purpose of concealing or
disguising the true source, disposition, movement, or ownership of those proceeds.
 Money Laundering according to the US Treasury Department, is the process by which
criminals or criminal organizations seek to disguise the illicit nature of their proceeds
by introducing them into the stream of legitimate commerce and finance.

      “Money laundering is called what it is because that perfectly describes what takes place
– illegal, or dirty, money is put through  a cycle of transactions, or washed, so that it comes
out the other end as legal, or clean, money. In other words, the source of illegally obtained
funds is obscured through a succession of transfers and deals in order that those same
funds can eventually be made to appear as legitimate income”.
      The goal of money laundering is to make funds derived from, or associated with, illicit
activity appear legitimate.

      Money laundering as a crime only attracted interest in the 1980’s essentially within a
drug trafficking context. It was from an increasing awareness of the huge profits generated
from this criminal activity and a concern at the massive drug abuse problem in western
society which created the impetus for governments to act against the drug dealers by
creating legislation that would deprive them of their illicit gains.

      Money laundering is a truly global phenomenon, helped by the International financial
community which is a 24 hours a day business. When one financial center closes business
for the day, another one is opening or open for business.

Three (3) Basic Steps to Change Illicit Funds to Legitimate Funds

1. Placement – involves a changing the bulk cash derived from criminal activities into a
more portable and less suspicious form, then getting those proceeds into the
mainstream financial system.

This is the most difficult and vulnerable step, simply because most illegal activity generates
profits in the form of cash, and cash is bulky, difficult to conceal, and, in large amounts, very
noticeable to the average bank teller, casino employee, etc.

Placement requires a finding a solution to the problem of how to move the masses of cash
generated from illegal activity into a mere manageable form for introduction into the
financial stream.

1. Layering – involves the movement of these funds, often mixed with funds of
legitimate origins, through the world’s financial systems in numerous accounts in an
attempt to hide the funds back into the mainstream economy, where they can be
invested and spent freely.

Typically, layering involves the wire transfer or movement of funds placed into a financial or
banking system by way of numerous accounts in an attempt to hide the fund’s true origin.
The most common method of layering is to wire-transfer through the offshore-banking
havens such as the Cayman Islands, Panama, The Bahamas, the Netherlands Antilles, and,
increasingly, Pakistan and Chili. Funds can be routed through shell corporations, or by using
counterbalancing loan schemes. The sheer volume of wire transfer adds to the problem of
tracking the origin.

1. Integration – is the process of reintroducing these layered funds back into the
mainstream economy, where they can be invested and spent freely.
Once funds are sufficiently layered, they are then integrated into the mainstream financial
world by a limitless variety of financial instruments, such as letters of credit, bonds
securities, bank notes, bills of lading, and guarantees. Some of the largest seizures of
laundered funds occur where integration fails and the entire account or accounts are seized.

Money Laundering Techniques and Tools

1. 1.  Smuggling – a simple smuggling technique involves a manipulation of the cash-

reporting regulations at the US border. A launderer smuggles cash from the US to
Mexico without declaring the money on a CMIR report. He then turns around and
comes back into the US, declaring funds at the US. Customs as legitimate revenues,
backed up with invoices, receipts, etc., derived from the phony business dealings in
Mexico. Customs then issue proper form, allowing the smuggling to deposit that
cash in the US bank without raising suspicion. Once the cash is in the account, it
could then be wire-transferred anywhere, since there were no reporting
requirements for wire transfer.

Smuggling of Cash is generally done in three ways:

1. a.  Shipping the bulk cash through the same channels used to bring in drugs, by
container ship, truck or airplane.
2. b.  Hand-carrying cash by courier
3. c.  Changing the cash into negotiable instruments such as money orders of traveler’s
checks, then mailing these to foreign banks and other foreign destination.
4. Structuring – this is the term used to avoid the reporting requirements of the Bank
Secrecy Act (BSA) by dividing large deposits of cash into multiple smaller
transactions of less than $10,000 each. A person structures a transaction if that
person, acting alone, or in connections with or in behalf of, other persons, conducts
or attempts to conduct one or more transaction in currency, in any amount, at one or
more financial institutions, one or more days, in any manner, for the purpose of
evading the reporting requirement.

3.  The Use of Front Companies

1. Front Companies in General. These are used by launderers to place and layer illicit
proceeds. Any cash-rich business can be an effective front company – jewelry stores,
check-cashing businesses, travel agencies, import/export companies, insurance
companies, liquor stores, racetracks, and restaurants are common fronts. In addition,
businesses that have inventories of products or materials that are difficult to value,
such as precious metals, jewelry, antiques, etc, are also common.
      Front companies are also used to conduct fraudulent international commercial trade
layer and integrate illegal proceeds. For example, drug proceeds can be deposited into an
American bank and then used to fund letters of credit for the fictitious importation of
consumer goods into the US from Columbia or elsewhere. Then, the individual presents a
false bill of lading at the appropriate bank in Columbia and collects the proceeds.

Front Companies are effective tools for money laundering for two reasons:

1. They do not necessarily require complicity of their financial institution or any non-
bank financial institution in order to operate.
2. They are difficult to detect if they are also conducting legitimate business,
particularly businesses exempt from currency transaction reports (CTR) by banks
because of the large volume of cash transactions. Exempt businesses include liquor
stores, race tracks, restaurants, and approximate 75% other businesses that banks
can unilaterally exempt from CTR reporting requirements.
3. Businesses Commonly Used as Front Companies
4. Jewelry Stores – these are convenient fronts for money laundering. In 1989, a
Justice investigation into Adonian Brothers Mfg. Co. and Ropex Co. revealed that
operators laundered over $ 1 billion in cash, ostensibly from the corporation’s jewelry
stores, by placement of the cash into various Los Angeles banks and then wire-
transferring it to South American banks.
5. Money-service businesses (MBSs) – these include money transmitters, check
cashing businesses, traveler’s-check and money-order issues, currency exchangers,
and issues of stored-value cards.
6. Travel Agencies – travel agencies that have the capacity of writing funds are also
attractive as front companies. One New York travel agency serving mainly Columbian
clientele laundered over $1 million per month by wire transfers.
7. Import/Export Companies – these are popular as fronts for money laundering.
Typically, these operations use three schemes to launder money; under-valuation
and over-valuation of goods, double invoicing, and financing exports.
8. The use of shell or nominee corporations

      The synonymous terms, “shell corporations,” “nominee corporations,” or “domiciliary

corporation” refer to a corporate structure that provides for anonymous corporate
ownership through various combinations of nominee directors and ownership of stock by
bearer shares.

      Shell corporations are one of the major tools in layering funds. For example, by the early
1980s, as much as 20% of all real property in the Miami area was owned by entities
incorporated in the Netherlands Antilles. One piece of property was traced through three
levels of Netherlands Antilles shell corporations, with the final “true” owner being a
corporation with bearer shares. These offshore corporations were in turn owned or
controlled by various drug traffickers.

1. Bank Drafts

      Mexican bank drafts are often the instrument of choice used by Mexican money
launderers to repatriate dollars back to the US. Each year, more than 500,000 bank drafts
drawn on Mexican banks enter the US. This happens because they are seldom reported and
there are few effective sanctions against banks for failing to file reports and through a
loophole in the US money-laundering statutes. Mexican bank drafts are not considered
negotiable instruments,” so it is not necessary to file a CTR.

1. Counterbalancing loan schemes

      This method involves parking illicit funds in an offshore bank, while using the value of
the value of the account as collateral for a bank loan in another country. Counterbalancing
loans were commonly used by the related companies and banks controlled by the Bank of
Commerce and Credit International in its 18-year money laundering run.

1. Dollar Discounting

      In this method, the drug trafficker instructs his accountant, or commissionista, to
arrange for the cartel’s controller to auction or factor the drug proceeds to a broker, or
cambista, at a discount. The broker then assumes the risk of laundering the money.
Essentially, the dealer is simply selling his accounts receivables at a discount. The gets less
cash, but he gets it sooner.

      Money laundering is also accomplished through postal money orders. Instead of selling
the American money on deposit in the US, a blank money order or checks is sent directly to
either Colombia or the Panama Free Zone. There, the funds can be sold and resold through
the network of casa de cambio, often going back to Mexico banks for final repatriation in
the US with the laundering cycle complete and the money ostensibly clean and untraceable
to illicit activity. Throughout this system, the parties create and use fictitious documentation
to produce a seemingly legitimate commercial history.

1. Mirror – Image Trading

      Mirror – image trading involves buying contracts for one account while selling an equal
number from another; since both accounts are controlled by the same individual, any profit
or loss is effectively netted. The key is to lose these transactions among millions of dollars
worth of legitimate transaction.

1. Reverse Flips
      A reverse flips is a real estate ploy whereby a launderer will purchase a property at a
documented or reported price well below its market value, paying the balance “under the
table to willing seller”. The launderer then resells the property for its value, realizing a paper
profit, well documented and legal.

1. Inflated Price

      Launderers, working through front companies or willing accomplices, simply create the
false invoices for goods either never actually purchased or purchased at greatly inflated
prices.

10. The Columbian black-market peso exchange

      This black – market exchange system operates to circumvent Columbian restrictions on

converting Columbian pesos to US dollar, which are medium of exchange in the Western
Hemisphere. To obtain US currency, an importer must certify that the necessary import
permits have been obtained and the requisite duties and import taxes have been paid. By
trading in illegal drugs, the Columbian drug kingpins, cannot legitimately provide these
permits; thus, they cannot obtain US currency, or exchange it for pesos, in the ordinary
course of business. Therefore, they have turned to the Columbian black market peso
exchange.

MONEY LAUDERING TECHNIQUES COMMON TO THE BANKING INDUSTRY

1. A.  The Use of Wire Transfer

ü  Wire transfer is simply the electronic transfer of money from one bank or entity to
another.

ü  The Uniform Commercial Code defines a wire transfer as “a series of transactions,

beginning with the originator’s order, made for the purpose of making payment to the
beneficiary of the order.

1. 1.  How wire transfer

2. A customer wishing to transfer instructs his bank to a certain amount to a specified
beneficiary account at another bank.
3. The originating bank sends an electronic “message” to the transfer system’s central
computer, indicating, an electronic format, the sending or originating bank, the
amount, the receiving or beneficiary bank, and the specific beneficiary.
4. The transfer system’s computer then electronically adjusts the account balances of
the originating and beneficiary banks and produces a printout of a debit ticket at the
originating bank and the credit ticket at the beneficiary bank.
 5. Once the beneficiary bank receives its credit ticket, it notifies the beneficiary of the
wire transfer.
6.  If the two banks are members of the same wire transfer system, then they are the
only two banks in the wire transfer chain. However, if they are not members of the
same system, which is standard for international transfers, it is necessary to route the
transfer through one or more intermediary banks that have “correspondent”
relationship with the other bank in the chain.
7. 2.  The Major Wire transfer systems
1. a.  “Clearing House” is an association through which banks exchange checks
and drafts drawn on each other, and settle their balances. Non-member bank
clear their commercial paper through clearing house member banks by
agreements with such banks. The Clearing House Interbank Payment System
(CHIPS) is the primary site for settlement of all US banking transactions such
as international foreign exchange and Eurodollar transactions and all
international and domestic trade transactions taking place through the New
York based US banking system.
2. b.  The Use of Conduit Account – money launderers establish accounts in
various banks throughout the world, using front companies for the sole
purpose of acting as intermediaries, or conduits, in wire-transferring money
form the originator to the ultimate beneficiary

Typically, a money launderer will set up as many as 15 to 20 individual in various cities

around the world. These individuals are given monthly or periodically stipend with which to
live and conduct normal, everyday banking transactions: writing checks, using credit cards,
etc. the purpose is to create a history of normal banking activity. Ultimately, and in
conjunction with the others in the “chain” there will be a flurry of wire transfers moving
money in and out of the various accounts. By the time regulators and law enforcement are
able to recognize the activity for what it is – money laundering – the individual have moved
on to new cities, with new IDs, to operate again. The front, shell and dummy corporations
that received much of the funds are usually not traceable to any identifiable person.

1. c.  The Use of Correspondent Accounts/Due from Accounts

Banks with no branches in foreign countries will establish a correspondent account with a
foreign bank or a domestic bank with a branch in that foreign country, in order to wire
money and conduct business for its clients with greater ease

1. d.  The Use of Payable – Through Accounts

A type of correspondent account, these accounts are maintained at American banks by

foreign banks, and are use by the foreign bank to conduct their depositor’s US currency
transactions. They are, in effect, a master correspondent account of a foreign bank in a US
bank through which customers of the foreign bank can transact business. Customers of the
foreign bank have signature authority in the master payable – through account and are
referred to as “sub-account holders”.

Money Laundering in Non- Bank Financial Institutions

1. 1.  Money Order Transmitters

Money order firms, or money transmitters, such as Western Union, American Express and
Money Gram, remit upwards of $11 billion annually, exclusive of fees, through over 43,000
locations in the US.

Postal money orders have been considered one of the safest and most efficient ways to
smuggle cash and negotiable instruments out of the US.

American Express, Western Union and Travellers Express are the three largest money
transmitters in the US, specializing in the domestic and international transfer of funds by
wire, check, computer network, and other means. Although they all claim to be free of
money laundering, they are most certainly not: American Express, for example, has over
37,000 locations where it sells money orders, 19,000 of which are at non-bank financial
institutions. American Express does not run criminal background checks on all of its agents,
nor does it continually monitor its locations for CTR compliance. In addition, only a few
states require licensing of the actual agents that perform the transfers.

1. 2.  Casas De Cambio

These are basically the peso-dollar exchange business equivalent in the southwestern US.
These sprang up following the devaluation of the peso in 1982.

It is estimated that 80% of the over 1,000 casas de cambio along the US – Mexican borders
are involved in money laundering. Although these are hundreds of unregulated casas on
both sides of the Mexican-Us borders, very few are licensed by the state banking
regulations.

1. 3.  Casinos

Laundering money through casinos is an effective way of placing and layering illicit funds, in
part, because of the huge volume of business, almost all of it in case, done by casinos.

Laundering money through casinos is difficult, but possible on a smaller scale. For
employees, clip skimming is common. For bettors, structuring remains the method of
choice. However, BSA, Nevada, and IRS regulations require that cash purchases of less than
$10,000 be aggregated if they exceed $10,000 and are made in the gaming area within
certain period of time – BSA and Nevada use a 24-hour “gamming day”, while the IRS-
regulated tribal casinos use a calendar year. Therefore, cash amounts of less than $10,000
can be spread across different gaming areas or laundered across several different BSA,
Nevada, or tribal casinos.

1. 4.  Card Clubs

Common in California, card clubs are casino-like operations, except that they offer only the
physical facilities for gaming by customers who bet against one another, rather than against
the house. In addition to gaming facilities, card clubs offer their members deposit and credit
accounts, facilities for transmitting and receiving funds transfer, check cashing, and currency
exchange.

1. 5.  Race Tracks

Although not technically a casino, race tracks provide money laundering with the same
atmosphere and opportunities to launder money as do casinos. Very simple, if you win a
certain amount of money, you must present identification to collect – the IRS is interested in
such winning. The basis for laundering money through a race track, then is the reluctance of
winners to declare their winnings to the IRS. A winning ticket is negotiable, like a bearer
bond, and can be sold by the winner for something less than the winning amount to “flies:
or “ten percenters”. These flies then present the ticket to a cooperative mutual clerk who
then dutifully fills out the proper forms – but with fictitious or manufactured identifications.
The actual better is satisfied as he has 90% of his winnings for which he does not have to
account, and the launderer has been able to “clean” his money at a reasonable cost – 90%
to purchase the winning bet, a further 10% to 20% to pay off the cooperating mutual clerk.

1. 6.  Insurance Companies

Insurance companies are being used more frequently to launder money. For example, a
launderer will purchase a single premium annuity under a false name or through a
corporate entity. The annuity can later be canceled, with a small penalty, and the insurance
company will remit a check for the balance, or wire the proceeds to a specified account.
Once that is accomplished, the funds appear legitimate and can be negotiated or sent out
of the US at will. Any querries as to the source of money are met by documentation of a
settlement of an insurance contract. Simple schemes such as this depend on this existence
of funds already having been placed into the financial system, as insurance companies
generally do not accept cash from customers or clients.

1. 7.  Security Dealers and Brokers

Security dealers and brokers – from small brokerage firms across the country to the large
wall street securities firms – have long been the targets of money launderers. As late as
March 1996, security dealers were not required to maintain BSA compliance program, nor
did they have a standard SAR form as banks do. As a result of the Miranda case, and others,
described brokers and securities dealers are now required to obtain taxpayer identification
numbers or the passport number of each person maintaining an account. In addition, as a
“financial institution”, they are subject to the Bank Secrecy and Money Laundering Control
Act reporting and record keeping requirements set out at 31 USC section of 5313 and the
31 sections 103.23(reporting) and 103.35 (record keeping).

3. TRANSNATIONAL CRIMES

3.3. C. CYBERCRIME

1. A.  CYBERCRIME

v  Is one of the terms used to denote the use of computer technology to engage in unlawful
activity.

v  It refers to all the activities done with criminal intent in cyberspace.

v  Cyber crime is unbounded crime; the victim and perpetrator can be in different cities, in
different states or in different countries. All perpetrator needs is a computer linked to the
internet.

Four Categories of Computer Crimes

1. 1.  The Computer as a Target – the attack seeks to deny the legitimate users or owners of the
system access to their data or computers. A Denial-of-Service (DOS) attack or virus that renders
the computer inoperable.

1. 2.  The Computer as an Instrument of the Crime – the computer is used to gain some other
criminal objective. For example, a thief may use a computer to steal personal information.

1. 3.  The Computer as incidental to a crime – the computer is not the primary instrument of the
crime; it simply facilitates it. Money laundering and the trading of child pornography would be
example of this category.

1. Crimes Associated with the prevalence of computers – this includes crimes against industry,
such as intellectual property theft and software piracy.

Legal Categories of Cyber Crime

1. 1.  Cyber-trespass – crossing boundaries into others people’s property and/or causing damage,
e.g. hacking, defacement, viruses

1. 2.  Cyber-deceptions and theft – stealing (money, property) e.g. credit card fraud, intellectual
property violations (piracy).
 1. 3.  Cyber-pornography – activities that breach laws on obscenity and decency.

1. 4.  Cyber-violence – doing psychological harm to, or inciting physical harm against others,
thereby breaching laws pertaining to the protection of the person, e.g. hate speech stalking.

Hacking – is gaining unauthorized access to computer system, and as such, is conceptually
analogous to real world trespassing.

Cracking – which consists of gaining unauthorized access to computer system for the purpose of
committing a crime “inside” the system, is conceptually analogous to burglary.

Malicious sending of e-mails – one of the very prevalent computer crimes in the Philippines, the
sending of malicious and defamatory electronic emails has rendered obsolete the traditional
“snail-threat-mail” and has likewise become a new medium of extorting money, or threatening
prospective victims. Dissemination of viruses, worms and other varieties of malicious code is
analogous to vandalism

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3. TRANSNATIONAL CRIMES

3.4. D. PORNOGRAPHY

1. A.  PORNOGRAPHY

Internet Pornography – is the trafficking, distribution, posting and dissemination of

obscene material including children’s nude pictures, indecent exposure, and child sex slavery
posted into the internet, live streaming videos aired through the internet under a certain
fee.

Different Kinds of Child Pornography

1. Indicative – non-erotic and non-sexualized pictures showing children in their

underwear, swimming costumes, etc, from their commercial sources or family
albums; pictures of children playing in normal settings, in which the content or
organization of pictures by the collector indicates inappropriateness.
2. Nudist – pictures of naked or semi-naked children in appropriate nudist setting and
from legitimate sources.
3. Erotica – surreptitiously taken photograph of children in play areas or other safe
environments showing either underwear or varying degrees of nakedness.
4. Posing – deliberately posed pictures of children fully, partially clothed or naked
(where the amount context and organization suggest sexual interest)
5. Erotic Posing – deliberately posed pictures of fully, partially naked children in
sexualized or provocative poses.
 6. Explicit Erotic Posing – emphasizing genital areas where the child is either naked,
partially or fully clothed.
7. Explicit Sexual Activity – involves touching, mutual and self-masturbation, oral sex
and intercourse by child not involving adult.
8. Assault – pictures of children being subject to a sexual assault, involving touching
involving adult.
9. Gross Assault – grossly obscene pictures of sexual assault involving penetrative sex,
masturbation, or oral sex involving adult.
10. Sadistic – pictures showing a child being tied, bound, beaten, whipped or otherwise
subject to something that implies pain.

3. TRANSNATIONAL CRIMES

3.5. E. CYBERSTALKING

1. A.  CYBERSTALKING

      The unwanted, threatening, or offensive email or other personal communication over
the computer that persists in spite of requests by the victim that it be stopped. It can also
include behavior that is aimed at a particular person, but not sent directly to that person. It
is analogous to traditional forms of stalking in that it incorporates persistent behaviors that
instill apprehension and fear.

      It simply utilizes a high-tech modus operandi to achieve its aims. In addition, the stalker
can frequently trace the victim’s phone number and address, and cyber stalking frequently
accompanies traditional stalking behaviors such as threatening phone calls, vandalism of
property, threatening mail and physical attacks.

Types of Cyber stalking

1. 1.  Email stalking – this is an electronic postal service that allows individuals to send
and received messages or information in a matter of seconds. In general, email is an
unsecure method for transmitting information or messages. Everyone who receives
an email from a person has access to that person’s email address.
2. Chat stalking – a chat room is a connection provided by online services and
available on the internet that allows people to communicate in real time via
computer text and modem. Cyber stalkers can use that chat room to slander and
endanger their victims.
3. Computer stalking – with computer stalking, the cyber stalker exploits the internet
and the windows operating system in order to assume control over the computer of
the targeted victim.
3. TRANSNATIONAL CRIMES

3.6. F. TERRORISM

1. TERRORISM

      Terrorism is the use and/or threat of repeated violence in support of or in opposition to

some authority, where violence is employed to induce fear of similar attack in as many non-
immediate victims as possible so those threatened accept and comply with the demands of
the terrorists.

The Morality of Terrorists Violence: 4 Quotations

1. “One person’s terrorist is another person’s freedom fighter”

      This is more likely to have originated in one form or another in the remote historical
past. Terrorists never consider themselves to the “bad guys” in their struggle for what they
would define as freedom. They might admit that they have been forced by a powerful and
ruthless opponent to adopt terrorist methods, but they see themselves as freedom fighters.
Benefactor of terrorists always live with clean hands, because they present their clients as
plucky freedom fighters. Nations that use technology of war to attack known civilian targets
justify their sacrifice as incidental to the greater good of the cause.

1. “One man willing to throw away his life is enough to terrorize a thousand”

      This quotation was written by the Chinese military philosopher, Wu Ch’i. This quotation
is the likely source for the better – known statement “kill one terrorize a thousand”. This
explains the value of a committed individual who is willing to sacrifice him or herself when
committing act of violence.

1. “Extremism in defense of liberty is no vice”

      Senator Barry M. Goldwater of Arizona made this statement during his bid for the
presidency in 1964. His campaign theme was very conservative and anti-communist. This
quotation represents an uncompromising belief in the absolute righteousness of a cause. It
defines clear belief in good versus evil and belief that end justifies the means. Terrorist use
this reasoning to justify their belief that they are defending their championed interest
against all perceived enemies – who are of course, evil.

1. “It became necessary to destroy the town to save it”

      This quotation has been attributed to a statement made by an American Officer during
the war in Vietnam. When asked why a village thought to be occupied by the enemy had
destroyed, he allegedly replied that American soldiers had destroyed the village to save it.
The village has been denied to the enemy, and it has been saved from the horrors of enemy
occupation. The symbolism of the village can be replaced by any number of symbolic
values.

      Terrorist used this kind to justify hardships that they impose not only on a perceived
enemy, but also on their own championed group. They have no concrete plan for what kind
of society will be built upon the rubble of the old one – their goal is simply to destroy
inherently evil system.

Terrorism and Criminal Skill: three cases

Case 1 : Richard Baumhammers

      Many terrorists incidents are the acts of individual gunmen who simply embark on
killing sprees, using a “low degree” of criminal sophistication. Baumhammers, a racist
immigration attorney influenced by Neo-Nazi ideology methodically shot his victim during a
20-mile trek. His victims were a Jewish woman, two Indian men, two Asian men, and an
African American man. The sequence of Baumhammers’s assault occurred as follows:

ü  Baumhammers went to his Jewish neighbor’s house and fatally shot her. He then set fire
inside her home.

ü  Baumhammers shot two Indian men at an Indian grocery store. One man was killed, and
the other paralyzed by a .357 slug hit his upper spine.

ü  Baumhammers shot a synagogue, painted two swastikas on the building, and wrote the
word, “Jew” on one of the front doors.

ü  He then drove to second synagogue, where he fired shots at it.

ü  Baumhammers shot two young Asian at a Chinese restaurant, killing them both.

ü  Finally, Baumhammers went to a Karate school, pointed his revolver at a white man inside
the school, and then shot to death an African American man who was a student at the
school

     The Baumhammers case illustrate how the lone wolf scenario involves and individual who
believes in a certain ideology but who is not acting on behalf of an organized group. These
individuals tend to exhibit “minimal” criminal skill and use minimal technology while
carrying their assault.
Case 2: Theodore “Ted” Kaczynski

     Using the “medium degree” of criminal sophistication, many terrorists have been able to
remain active for long period of time without being captured by security agents. An
example is Ted Kaczynski popularly known as “Unabomber”.

     In May 1078, Kaczynski began constructing and detonating a series of bombs directed
against corporations and universities. His usual practice was to send the device through the
mail disguised as business parcel. His attack includes the following:

ü  A bomb caught fire inside a mail bag aboard a Boeing 727. It has been rigged with a
barometer trigger to explode at a certain altitude.

ü  A package bomb exploded inside the home of the president of United Airlines injuring
him.

ü  A letter bomb exploded at Vanderbilt University injuring a secretary. It had been

addressed to the chair of the computer science department.

ü  Two Universities of Michigan scholars were injured when a package bomb exploded at a
professor’s home. The bomb had been designed to look like a manuscript for a book.

ü  An antipersonal bomb store exploded in a parking lot behind a computer rental store,
killing the store owner.

During the 18 years period, Kaczynski was responsible for the detonation of more than 15
bombs around the country, killing 3 people and injuring 22 more.

Case 3: RamziYousef

      Involving “high degree” of criminal sophistication, some terrorist attack are the work of
individuals who can be described as masters of their criminal enterprise. On February 26,
1993, RamziYousef detonated a bomb in a parking garage beneath Tower One of the World
Trade Center in New York City. The bomb was a mobile truck that Yousef and associates had
constructed in New Jersey from converted Ford Econoline van. It was fairly simple design
but extremely powerful.

      According to investigators and other officials, Yousef’s objective was to topple Tower
One onto Two “like pair of dominoes”, thus achieving a very high death toll. This case is a
good example of the technical skill and criminal sophistication of some terrorists. Yousef
had connections with well-funded terrorists, was a sophisticated bomb maker, knew how to
obtain the necessary components in a foreign country was very adept at evasion, and
obviously planned his action in meticulous detail.
3. TRANSNATIONAL CRIMES

3.7. PMQUIZ 2
-Bond paper, 1" all side as margin.

- 11 Tahoma- Font size and Font style.

-Send to joelnehyeban@gmail.com

-Not later than July 10, 2021.

- Late papers will not be recorded. Thanks.

-Elaborate and expound on how human trafficking and money laundering are committed?
(20 points)

-What are the elements that is needed to prove that there is such commission of human
trafficking and money laundering? (20 points).

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