theeurasiangrouponcombatingmoneylaunderingand.docVIP

The Eurasian Group on combating money laundering and financing of terrorism (EAG) Working Group on Typologies (WGTYP) _____________________________________________________________________________ “LAUNDERING OF PROCEEDS FROM EMBEZZLEMENT OF PUBLIC FUNDS December, 2009, Moscow, Russia  Table of Contents Chapter 1: 3 Introduction 3 Trends of studies 4 Information base 4 Chapter 2: 5 Role of corruption 5 Negative impact of corruption and crimes involving embezzlement of public funds 7 Vulnerabilities in public funding 7 Chapter 3: 8 The most common types of mismanagement of public funds 8 Examples of theft in public funding sectors 10 Example 1: Theft in public procurement 10 Example 2: Attempt at misappropriation of public funds in implementation of state-run programs 10 Example 3: Theft by illegal recovery of funds out of the budget 11 Embezzlement of budget funds through an extended chain of intermediaries 11 Misappropriation through engagement of unofficial teams in construction works 12 Embezzlement through overstatement of work scope 12 Embezzlement through avoidance of mandatory quotations in rendering services to public and municipal institutions 12 Direct theft pattern 13 Chapter 4: 13 Typologies of laundering of misappropriated public funds 13 Typology: 1 14 Laundering of criminal proceeds from embezzlement of public funds by the money transfer through the chain of intermediaries to the bank accounts of legal entities and individuals, followed by cash withdrawal Typology: 2 15 Legalization of criminal proceeds from embezzlement of public funds by their transfer through the chain of intermediaries to the bank accounts of offshore companies and individuals abroad Using “fly-by-night” and offshore companies 17 Typology: 3 17 Legalization of illegal proceeds from embezzlement of public funds using the schemes of grey” banking service Procedures 21 Tools 23 Chapter 5: 24 Indicators (criteria) of suspicious financial transac