The report produced by Europol, a law enforcement agency of the EU, focuses on the business and financial facets of the modern-day slave trade. The report highlights the interrelationship within organized crime groups, the methods implemented in the crime, the further exploitation of victims, and money laundering.
Human trafficking itself involves the sexual exploitation, forced labor, or organ extraction of humans. In the report, Europol found that organized crime Groups:
“…are mainly small and based on family and ethnic ties. The family cell is used to support trafficking operations and money laundering activities.”
It also found that victims of human trafficking are being used for other illegal purposes:
“…such as begging, benefit fraud, identity fraud, credit fraud and insurance fraud.”
Victims were also registered under different addresses in the country they have been smuggled into, so they could receive social benefits. Often, the trafficker is custodian of the account and manages the benefits payed to the victim. So they receive all of the benefits paid to the victim, and then the victims are repatriated once the trafficker has what they need to continue to exploit the system. Victims were also found to be trafficked into forced or sham marriages.
Per laundering methods, organized crime groups also purchase real estate through offshore companies and pseudo-valuations of their investments.
To make the illegal proceeds appear as though they were obtained from legal sources within the financial system, there are 3 basic steps that the report notes:
“Money derived from criminal activities is placed into the legitimate financial system [placement], moved among several recipients internationally (e.g. personal or business accounts) [layering] and then returned to the criminal group from seemingly legitimate sources. [integration]”
This form of laundering can be used to identify criminals of this type. An investigation of the illegal activities would expose members that are involved with the criminal groups by looking into the transactions and determining whom they were sent to.
The report notes that the International Labour Organization estimated the profits derived from human trafficking to exceed $32 billion. However, Europol also acknowledges that:
“…it is challenging to estimate the overall profits derived from THB activities in the EU… However, open sources provide some assessments of the possible scale of the profit derived from THB globally.”
THB is an acronym for Trafficking of Human Beings. Further:
“No evaluation of profits derived from THB activities in the EU specifically is available. Yet open sources reported on parts of the phenomenon, estimating the profits of sexual exploitation in the EU and developed economies to reach EUR 23.5 billion.”
International transactions were transmitted by:
“…sending money to a substantial number of people in order to blur the links between them, or by avoiding the placement of large sums into the system in order to evade Customer Due Diligence (CDD) and suspicious transactions reporting requirements”
Moreover, Europol reports that organized crime groups are in favor of transaction-based services in opposition to account-based services due to the latter’s marketing approach in which it retains few details on the customer.
“This makes it very difficult to assess whether activities appear unusual compared to a customer’s standard behaviour.”
Organized crime groups have most frequently opted to launder money via cash couriers. This method is attractive because of the:
“…advances in technology enabling the tracing of online transactions.”
The findings of the report offer a deeper look into the goings on of human trafficking. On the surface level, it may seem as though the victims are largely just sexually exploited, but it is not the only case. Investigations into the financial systems need to be launched in order to combat the proliferation of human trafficking.
