Thomson Reuters, a source of news and information for professional markets, has today announced the launch of TRAC, a new anti-money laundering solution to combat trade based money laundering (TBML) and drive transparency and efficiency across trade finance.
Trade Based Money Laundering
TBML is the use of international trade as a channel for legitimising money obtained from illicit activities. Schemes differ in complexity but usually involve misrepresentation of the price, quantity or quality of imports or exports. Financial institutions may unknowingly be implicated in these schemes when they are used to settle, facilitate, or finance international trade transactions.
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BC Tan, Head of Client & Third Party Risk, Asia Pacific, Thomson Reuters said, “Trade finance is fundamental to global trade, yet indicators highlight TBML as a growing global problem with a recent report from Global Financial Integrity suggesting that 80% of illicit financial flows from developing countries are made through TBML schemes. As a result, global regulators are launching initiatives to mitigate the risks surrounding trade finance, with Singapore and Hong Kong the first countries in Asia to issue specific regulations related to trade finance”.
TRAC which stands for “Trade Finance, Regulations, Audit and Control” is a first-of-its kind end-to-end solution offering holistic risk management of trade finance while satisfying the Monetary Authority of Singapore and Hong Kong Monetary Authority’s recently developed guidelines on combating TBML.
TRAC combats risks at different stages of the trade finance life-cycle. From pre-trade, execution to post-trade, it performs screening of vessels and third parties, tracks shipments, provides regulatory reporting and monitors transactions.
The solution utilises a powerful and highly customisable workflow for users and incorporates Thomson Reuters World-Check for compliance screening, Eikon for price validation and shipment tracking as well as OneSource for dual goods screening to help banks and financial institutions comply with regulations and increase efficiency and transparency across their trade finance operations.